Tesla Inc. shares fell 14.5% on Thursday after the company reported second-quarter earnings that missed analyst expectations.
Tesla Inc. shares dropped 14.5% on Thursday, marking the company's largest one-day decline in over a year. The selloff followed a second-quarter report where revenue reached $28.24 billion, but adjusted earnings per share of $0.33 fell short of the $0.50 estimate. Investors expressed concern over the company's high valuation and the timeline for returns on significant investments in artificial intelligence and robotics. The stock's decline resulted in approximately $4.3 billion in paper profits for short sellers. Despite the miss, Tesla reported a 26% year-over-year revenue increase and a 25% jump in deliveries. The company continues to spend aggressively on capital expenditures, including the development of the Optimus humanoid robot and the Robotaxi rollout. While the auto business showed signs of improvement, analysts noted that the market's tolerance for high spending may narrow without consistent proof of return on investment. Tesla remains the most expensive stock among the Magnificent Seven on a forward profits basis.