Tesla Stock Plunges 11% as Q2 Report Shows Decreasing Profits, Missed Goals

Elon Musk’s Tesla [Tesla stocks URL: https://www.google.com/search?q=tesla+stock&rlz=1C1CHBF_enUS905US905&oq=tesla+st&aqs=chrome.1.69i57j0i22i30l4j69i61.7414j0j7&sourceid=chrome&ie=UTF-8] took a hit on Wednesday, dipping 11% after its Q2 report revealed a drop in profits and multiple missed targets. The tech titan, already facing competition from Chinese EV makers, now sees its stock fluctuating wildly, dropping by 44% earlier this year.

The Numbers Don't Lie

Although Tesla's Q2 revenue rose to $25.05 billion [Q2 revenue report URL: https://www.cnbc.com/2023/07/20/tesla-q2-2023-earnings.html], adjusted numbers show a decline. With adjusted profits at $0.52 against $0.60 expected, the report outlines a 40% profit decrease.

Tesla's Future: AI and Affordability?

Musk, an avid user of his newly acquired social media platform, X (formerly Twitter) [Twitter URL: https://twitter.com/], has remained silent on the slump. Instead, he frequently discusses Tesla's AI aspirations, including a "Tesla Bot" and a "Robotaxi." Despite falling profits, Tesla may be shifting focus, with production estimates surpassed and plans for more affordable models on the horizon, according to the Q2 report:

"Plans for new vehicles, including more affordable models, remain on track for start of production in the first half of 2025...They will be able to be produced on the same manufacturing lines as our current vehicle line-up."

The company's rebound hinges on these innovations, with Musk implying that Tesla is merely in a transitional growth phase.

Beck Andrew Salgado
For the latest insights, email: Bsalgado@gannett.com