Tesla (TSLA) stock is sliding after the Robotaxi event, which failed to impress investors with its cybercab offering. This pushed other ride-hailing stocks like Uber (UBER) and Lyft (LYFT) higher on Friday. Rohit Kulkarni, Managing Director of Roth MKM, speaks to Catalysts about the ridesharing sector.

Kulkarni points out that anticipation for Tesla's event was “an overhang” on shares of Uber and Lyft. He explains that the main question investors were asking was: If Tesla becomes the rideshare option of choice, what will happen to Uber and Lyft? This concern has “become increasingly louder over the last three to six months.” However, based on the results of Thursday's Robotaxi event, Kulkarni says it is “a big, big relief” for these companies as the event showed that “creating a scalable Robotaxi business is not easy.” He points out that it will take a lot of time and resources while Uber and Lyft continue to gain market share.

“Tesla as a big, big player or potential big player is now off the table. This is the relief rally you see with Uber and Lyft,” he explains, adding that the next major catalyst for these companies would likely come from advertising and subscription growth.

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This post was written by Angel Smith