Elon Musk’s Tesla reports 45% profit drop

It was the fourth consecutive miss for the electric-vehicle maker, which on Tuesday reported adjusted earnings of 52 cents a share, short of the average analyst estimate of 60 cents a share. Tesla’s revenue increased to $25.5 billion, more than the $24.6 billion analysts were expecting. 

The Elon Musk-led company said its focus remains on cutting costs, and reiterated it sees a “notably lower” growth rate for 2024 while it’s between “growth waves.” 

The EV maker’s shares fell 3.6% to $238 at 4:23 p.m. in New York, after the close of regular trading. The stock was down about 1% this year at the close of trading Tuesday.

Tesla already reported second-quarter sales that beat analyst expectations and sent the stock soaring. While deliveries were down from a year ago, Tesla improved on a sequential basis from the first three months of the year. Stronger purchases were partly spurred by a series of price cuts that cut into the company’s margins. Its automotive gross margin, excluding regulatory credits — a closely watched metric by investors — reached 14.6% in the second quarter, compared to 16.4% in the first quarter.

Investors have bought into Musk’s promises that fully autonomous robotaxis and humanoid robots are around the corner, nearly reversing a year-to-date stock price decline. At one point in 2024, shares were down more than 40% from the end of last year as a result of Tesla’s weaker vehicles sales.

The company expects to make more cars in the current period than it did in the second quarter, it said. Additionally, its new Cybertruck is on track to make a profit by the end of the year while plans for a lower-cost vehicle are moving ahead, with production expected to start in the first half of 2025.