Tesla Stock Drops After Weak Earnings Report
Tesla reported earnings for April through June on Wednesday. Profits were far lower than expected.
Tesla shares fell more than 3% in after-hours trading. Some reports say the drop was closer to 4%.
Earnings per share missed Wall Street expectations. But Tesla beat expectations on revenue.
It posted $28.24 billion versus the expected $25.71 billion. Operating income fell 57%.
Operating margin shrank to 1.4% from 4.1%. Tesla stock had already fallen about 14% this year before the earnings report.
Some reports put that decline as high as 17%. Analysts point to competition from Chinese car makers.
They also point to consumer boycotts linked to Musk's political activities. During a call with investors Musk said Tesla and SpaceX operations increasingly overlap.
Key Terms 3
- Operating margin Share of revenue left as profit after regular business costs
- SpaceX Musk's rocket and space company separate from Tesla
- Year to date The change in stock price since the start of this year