Tesla (NASDAQ:TSLA) Stock Price Down 14.5% on Disappointing Earnings

Key Points

• Tesla shares fell 14.5% after the company reported weaker-than-expected quarterly earnings, briefly trading as low as $315.73.
• Tesla posted EPS of $0.33, missing Wall Street’s $0.50 estimate, even though revenue of $28.24 billion topped expectations and rose 25.5% year over year.
• Investor concerns remain focused on margin pressure, negative free cash flow, and heavy AI/robotaxi spending, which are raising questions about near-term profitability and cash needs.

Tesla, Inc. (NASDAQ:TSLA - Get Free Report)'s stock price traded down 14.5% during mid-day trading on Thursday after the company announced weaker than expected quarterly earnings. The stock traded as low as $315.73 and last traded at $319.69. 114,492,156 shares changed hands during trading, an increase of 101% from the average session volume of 56,858,168 shares. The stock had previously closed at $374.01.

The electric vehicle producer reported $0.33 EPS for the quarter, missing analysts' consensus estimates of $0.50 by ($0.17). Tesla had a return on equity of 4.89% and a net margin of 3.95%.The firm had revenue of $28.24 billion for the quarter, compared to analyst estimates of $26.42 billion. During the same period last year, the firm earned $0.33 EPS. The company's revenue for the quarter was up 25.5% compared to the same quarter last year.

Tesla News Summary

Here are the key news stories impacting Tesla this week:

• Positive Sentiment: Q2 revenue came in above expectations and Tesla reported record deliveries, showing demand for its vehicles remains resilient. Tesla shares fall after earnings miss despite record deliveries and AI investment NASDAQ: TSLA
• Positive Sentiment: Tesla highlighted continued progress in FSD, robotaxi scaling, and Optimus production, which supports the long-term growth story if execution improves. Elon Musk Explains Why Tesla Is Scaling Robotaxi So Slowly
• Neutral Sentiment: Some analysts reiterated positive long-term views, but several also cut price targets and kept neutral ratings, reflecting a split outlook on Tesla’s near-term profits versus autonomy upside.
• Neutral Sentiment: France’s opposition to EU approval of Tesla’s current FSD software adds another regulatory hurdle for its driver-assistance ambitions overseas. France opposes EU approval of Tesla's FSD driver assistance software for now
• Negative Sentiment: Investors are reacting to the earnings miss, negative free cash flow, and margin compression, which suggest Tesla’s core auto business is under pressure as spending rises. Tesla Stock Tumbles After Big Earnings Miss
• Negative Sentiment: The company’s aggressive AI and robotaxi spending is creating fears of a cash squeeze, and Wall Street appears to want clearer proof that those investments will pay off soon. Tesla sees a $200 billion wipeout as investors pan Musk's plan to spend ‘as fast as we can’

Wall Street Analyst Weigh In

A number of equities analysts recently commented on TSLA shares. William Blair restated a "market perform" rating on shares of Tesla in a report on Thursday, July 2nd. Truist Financial set a $370.00 target price on shares of Tesla and gave the company a "hold" rating in a report on Thursday. JPMorgan Chase & Co. reduced their price target on shares of Tesla from $475.00 to $445.00 and set a "neutral" rating for the company in a research report on Thursday. Wedbush restated an "outperform" rating and issued a $600.00 price target on shares of Tesla in a report on Tuesday, April 21st. Finally, Citizens Jmp began coverage on Tesla in a research note on Thursday, July 9th. They issued a "market perform" rating for the company. Twenty-one equities research analysts have rated the stock with a Buy rating, twenty-one have issued a Hold rating and four have assigned a Sell rating to the company. Based on data from MarketBeat, the company currently has an average rating of "Hold" and an average target price of $406.42.

Insider Buying and Selling at Tesla

In related news, Director Kathleen Wilson-Thompson sold 26,409 shares of Tesla stock in a transaction dated Thursday, April 30th. The stock was sold at an average price of $378.11, for a total transaction of $9,985,506.99. Following the completion of the sale, the director owned 48,399 shares in the company, valued at approximately $18,300,145.89. This trade represents a 35.30% decrease in their position. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Vaibhav Taneja sold 2,606 shares of the firm's stock in a transaction that occurred on Monday, June 8th. The stock was sold at an average price of $402.20, for a total transaction of $1,048,133.20. Following the sale, the chief financial officer owned 22,039 shares in the company, valued at approximately $8,864,085.80. This trade represents a 10.57% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold 32,015 shares of company stock worth $12,383,640 over the last 90 days. Company insiders own 19.90% of the company's stock.

Institutional Inflows and Outflows

Large investors have recently made changes to their positions in the company. Capstone Wealth Management LLC increased its stake in Tesla by 65.4% during the second quarter. Capstone Wealth Management LLC now owns 1,093 shares of the electric vehicle producer's stock worth $460,000 after acquiring an additional 432 shares during the last quarter. Symmetry Partners LLC raised its holdings in Tesla by 13.7% in the second quarter. Symmetry Partners LLC now owns 2,550 shares of the electric vehicle producer's stock valued at $1,073,000 after buying an additional 308 shares during the period. RIA Advisory Group LLC lifted its position in Tesla by 3.0% during the second quarter. RIA Advisory Group LLC now owns 6,712 shares of the electric vehicle producer's stock valued at $2,823,000 after buying an additional 198 shares in the last quarter. Foronjy Financial LLC purchased a new stake in Tesla during the second quarter worth approximately $219,000. Finally, ERn Financial LLC increased its position in shares of Tesla by 40.4% in the second quarter. ERn Financial LLC now owns 3,511 shares of the electric vehicle producer's stock worth $1,477,000 after acquiring an additional 1,010 shares in the last quarter. 66.20% of the stock is owned by hedge funds and other institutional investors.

Tesla Stock Performance

The company has a current ratio of 2.04, a quick ratio of 1.62 and a debt-to-equity ratio of 0.09. The firm has a market cap of $1.20 trillion, a PE ratio of 293.29, a P/E/G ratio of 12.72 and a beta of 1.80. The stock's 50 day moving average price is $405.39 and its 200 day moving average price is $404.00.

Tesla Company Profile

Tesla, Inc NASDAQ: TSLA is an American company that designs, manufactures and sells electric vehicles, energy generation and energy storage products. Founded in 2003 by Martin Eberhard and Marc Tarpenning, Tesla grew into a vertically integrated mobility and clean‑energy company with Elon Musk serving as its chief executive officer. The company's stated mission is to accelerate the world's transition to sustainable energy, reflected in its combined focus on electric drivetrains, battery technology, renewable energy products and software.

Tesla's automotive business includes a lineup of battery‑electric vehicles and related services.

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