Tesla revenue plunges in worst quarterly result in over a decade
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The news: Tesla reported the steepest decline in quarterly revenue in more than a decade, with a 12% fall to USD22.5 billion ($34.1 billion) in the second quarter, missing Wall Street estimates.
The numbers: Adjusted earnings were USD0.40 per share, below the USD0.43 consensus. Free cash flow fell 89% to USD146 million, and regulatory credit revenue dropped to USD439 million.
Deliveries declined across all models, including a 52% drop for non-Model 3/Y vehicles.
After initially slipping after the result, shares were trading largely unchanged in extended trading.
The context: Tesla faces growing competition, falling demand and backlash against Elon Musk’s political involvement. Musk’s departure from the Trump administration and formation of a new political party have fuelled concerns about his focus, and multiple top executives have recently exited.
The company’s first annual drop in deliveries missed Musk’s guidance and analyst expectations, while its regulatory credit revenue is also declining.
What they said: Tesla said it began initial production of a more affordable model in June, with volume production expected in the second half of 2025. A small trial of its robotaxi service launched last month in Austin, Texas.
“Despite a sustained uncertain macroeconomic environment resulting from shifting tariffs, unclear impacts from changes to fiscal policy and political sentiment, we continue to make highvalue investments in CapEx and R&D, while ensuring a strong balance sheet,” the company said.
“Our priorities remain the same: delivering affordable and compelling autonomy-capable models that maximize our global fleet of vehicles as our autonomy software continues to rapidly progress, growing the Energy business and advancing our robotics efforts.”
