Tesla shares slump after Q2 profit miss, higher AI spending
Make us a preferred source
Make us a preferred source on Google
The news: Shares in Tesla fell in after-hours trading after the electric-vehicle maker missed Wall Street’s profit estimates despite reporting a strong second-quarter revenue.
Shares were down 4.2% to USD358 ($512) at 9:15am AEST.
The numbers: Second-quarter net income dropped 5% compared to the prior corresponding period to USD1.11 billion, while adjusted net income saw a 17% year-on-year decrease to USD1.15 billion, or 33 US cents per share.
Operating income fell 57% to USD398 million, down from USD923 million a year ago, dragged down by surging AI infrastructure spending.
Total revenue jumped 26% to USD28.24 billion, fuelled by a record quarter that saw more than 480,000 vehicles delivered.
The context: Tesla’s adjusted earnings figure of 33 US cents per share fell short of Wall Street analysts’ expectations of 51 US cents.
The company also reported its first quarter of negative free cashflow in more than two years, burning through USD1.09 billion.
Chief financial officer Vaibhav Taneja reiterated that spending this year will total more than USD25 billion, a figure projected to grow as the company plans to increase production of cars, batteries and robots across half a dozen plants, Bloomberg reported.
