As an ardent follower of the electric vehicle (EV) industry, I’ve noticed a concerning dip in sales for Tesla (TSLA). On July 2, the EV pioneer disclosed a 13.5% year-on-year decline in second-quarter deliveries. However, the stock is plummeting today following Tesla’s comprehensive reveal of its second-quarter financial report for this year.
Initially, Tesla’s shares fell as much as 10%, but later recovered some of that decline. At noon, the stock was still 9% lower following what seemed like an underwhelming report. Despite this, those who are optimistic about Tesla might find this a good opportunity to buy at a reduced price.
The robotaxi rollout is on track
It’s clear that investors anticipated a decrease of 13.5% in deliveries, but they were even more let down when they noticed a 16% drop in automotive revenue compared to the previous year. This suggests growing strain on vehicle pricing, leading to a reduction in the gross profit margin over the same period.
It seemed like the tide kept turning against them, as I observed. The free cash flow for the second quarter only managed to reach $100 million. Moreover, their once swiftly expanding energy generation and storage sector even experienced a decline of 7.5% in revenue compared to the previous year.
During the earnings call, CEO Elon Musk emphasized future plans, and Tesla optimists likely found his comments encouraging. Musk expressed that it is highly probable that autonomous ride-hailing could become available to approximately half of the U.S. population by year’s end, assuming regulatory approvals are granted. He also stated that Tesla has the technical capability to achieve this goal.
Pump the brakes on Tesla
The key to Tesla optimists lies in their faith in Tesla’s robotaxi venture. Certain experts foresee autonomous ride-sharing services potentially reaching a valuation of one trillion dollars. Despite the anticipated fierce competition, Tesla could emerge as a significant contender, leveraging vast amounts of data collected from its electric vehicles currently on the road.
Elon Musk has often made daring forecasts that haven’t always become reality. Adventurous investors might consider purchasing stocks during this dip, considering the potential market for autonomous taxis from Tesla. However, it’s important to note that the actual deployment of Tesla’s self-driving taxis might not match or exceed Musk’s predicted pace or scale as stated yesterday.
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2025-07-24 21:45