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Tesla Inc. (NASDAQ: TSLA) today announced a significant 40% drop in profit for the second quarter of 2024 compared to the same period last year. The company reported adjusted income of $1.8 billion, or 52 cents per share, falling short of analysts’ expectations of 61 cents per share. This is down from 91 cents per share in the second quarter of 2023.
The decrease highlights the challenges Tesla faces as more automakers enter the electric vehicle (EV) market and overall EV sales growth slows. This is the second straight quarter of year-over-year sales declines for Tesla, a first for the company outside of the early pandemic period when factory shutdowns occurred.
Tesla’s profit margins have also been hit by recent price cuts on its EVs. While the company did not provide a new sales target for the year, it warned that vehicle volume growth in 2024 might be lower than in 2023.
CEO Elon Musk remains confident about Tesla’s future, emphasizing the shift towards fully electric transportation systems. He announced that more details on Tesla’s fully automated robotaxis will be shared in October, delayed from August. Musk acknowledged the regulatory and technical hurdles ahead but remains optimistic about achieving fully autonomous robotaxis by next year.
Tesla is under federal investigation for some of Musk’s claims about its Full Self Driving capabilities and has faced inquiries from the Department of Justice.
Musk also revealed that Tesla’s plans to build a factory in Mexico are on hold. This decision follows threats by Republican nominee Donald Trump to impose tariffs on vehicles imported from Mexico if he wins the presidential election. Musk, a Trump supporter, has endorsed and pledged financial support for his re-election campaign.
Following the earnings report, Tesla’s shares fell over 8% in after-hours trading. The shares are down about 1% so far this year after dropping as much as 44% earlier.
