Tesla Inc (NASDAQ:TSLA) shares slipped more than 3% afterhours as the electric vehicle maker’s second quarter profits fell short of expectations.
Operating income was $1.6 billion compared to estimates of about $1.7 billion, taking into account restructuring and other charges of $0.6 billion.
Adjusted earnings per share (EPS) of $0.52 were down 43% from the year-ago quarter and missed estimates of $0.62.
A bright spot was revenue, which increased 2% from the year-ago quarter to a record $25.5 billion.
Margins were down 333 basis points year-over-year at 6.3% but marked a sequential improvement from 5.5% in Q1.
Tesla acknowledged the “difficult operating environment” during Q2 and warned that its 2024 vehicle volume growth rate may be "notably lower" than 2023.
Further, the production of new models, including a more affordable EV, is not expected until the first half of 2025.
Tesla said its focus remains on company-wide cost reduction, including reducing the cost of goods sold (COGS) per vehicle, growing its traditional hardware business and accelerating the development of its AI-enabled products and services.
“Though timing of Robotaxi deployment depends on technological advancement and regulatory approval, we are working vigorously on this opportunity given the outsized potential value,” the company said in a statement.
“Concurrently, we are managing our product portfolio with a long-term orientation and focusing on growing sales, maximizing our installed base and generating sufficient cash flow to invest in future growth.”
Shares of Tesla traded down 3.2% at about $238 post-earnings.