Lowest quarterly profit margin in more than five years comes as EV car manufacturer looks to stem sagging demand
Tesla ’s second-quarter margin missed analysts’ estimates as price cuts and incentives to offset sagging demand continued to hurt the bottom line while the company intensifies its self-driving technology efforts, it said on Tuesday.
Tesla recorded automotive gross margin excluding regulatory credits of 14.65 per cent in the second quarter, compared with estimates of 16.29 per cent, according to 20 analysts polled by Visible Alpha. It was the lowest quarterly margin in more than five years, and shares of the electric-vehicle maker were down about 4 per cent in after-hours trading.
The results were a reminder of headwinds facing the company in its main auto business, even as chief executive Elon Musk reoriented the carmaker to self-driving technology, helping Tesla stock recoup most of its losses this year. The company on Tuesday reported revenue of $25.5 billion for the three months to end-June, compared with $24.93 billion a year earlier. Analysts on average had estimated $24.77 billion.“Plans for new vehicles, including more affordable models, remain on track for start of production in the first half of 2025,” Tesla said in a statement. Tesla reiterated that cost reductions for new vehicles would be less than expected.
Net income was $1.48 billion in the second quarter, compared to $2.7 billion a year ago. Adjusted earnings of 52 US cents per share missed the Wall Street consensus of 62 cents.
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