Why Tesla Stock Is Plummeting Today

Today, Tesla’s (TSLA) shares are declining following the release of their latest quarterly report, dropping by 8.5% as of 10:30 a.m. Eastern Time. This downtrend occurred despite a slight increase of 0.1% for the S&P 500 and no change in trading for the Nasdaq Composite. Earlier in the day, the stock had fallen even further by 9.5%.

Yesterday, Tesla shared its second-quarter financial outcomes after the market had closed, and these figures fell short of already revised predictions. Piling on negative sentiments, the firm additionally offered some cautious future projections, while a fresh report indicated that Tesla was still losing ground in Europe‘s auto market.

Tesla stock sinks on Q2 numbers and outlook

According to Tesla’s non-GAAP (adjusted) report, they earned $0.40 per share and generated sales totaling $22.5 billion. In contrast, analysts surveyed by LSEG predicted an earnings per share of $0.43 on revenue of approximately $22.74 billion.

In Q1, automotive earnings dropped by about 16% compared to last year, reaching approximately $16.7 billion. Additionally, revenue generated from regulatory credits within this sector decreased by nearly 51%, ending up at around $439 million. Despite investors’ expectations of weaker performance in the quarter, the results were even more disappointing than predicted.

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This morning, the European Automobile Manufacturers Association released new reports about the auto industry, stating that Tesla’s market share has decreased in Europe during June. According to their findings, Tesla’s total market share in the EU, UK, and EFTA fell to 2.8% in June, which is a decrease from its 3.4% share in the same month last year.

What’s next for Tesla?

In a recent conference call, I observed as Elon Musk, our CEO, shared insights about the company’s future. He mentioned that due to escalating tariff costs and the phase-out of federal subsidies for electric vehicles (EVs), Tesla might experience some challenging quarters ahead. The competitive landscape in our primary EV market is becoming fiercer, with new models from Chinese companies and other automakers potentially affecting our sales significantly.

In these trying times for our auto business, the optimistic outlook for Tesla hinges more on promising advancements in areas such as robotaxis, robotics, and other ventures that fall outside of our core market.

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2025-07-24 18:31