Shares of electric vehicle maker Tesla (TSLA) are down 7% after the company posted a big profit miss for this year’s second quarter.
The company led by Elon Musk announced earnings per share (EPS) of $0.33 U.S., which was well short of the $0.51 U.S. expected on Wall Street.
The automaker’s revenue in the spring quarter totaled $28.24 billion U.S., which was ahead of the $25.71 billion U.S. consensus expectation of analysts. Sales were up 26% year-over-year.
Tesla also reported that its operating margin fell to 1.4% from 4.1% a year ago. And the company’s free cash flow turned negative in the latest quarter.
The company announced a deficit of $1.1 billion U.S. after generating free cash flow of $1.44 billion U.S. in this year’s first quarter.
Management blamed the poor results on increased spending related to artificial intelligence (A.I.) and other new technologies.
Operating expenses increased 47% to $4.35 billion U.S. in the second quarter, outpacing revenue generated at the company.
Tesla has increasingly shifted its focus away from electric vehicles and toward self-driving Robotaxis and humanoid robots.
Capital expenditures at the company soared 142% to $5.79 billion U.S. in Q2 of this year, up from $2.39 billion U.S. in the same period of 2025.
Tesla’s core automotive segment generated $20.52 billion U.S. in revenue during the latest quarter, up 23% from a year ago.
The electric vehicle manufacturer has moved to sell lower-cost versions of its popular Model 3 and Model Y vehicles after retiring its more expensive Model S and Model X vehicles.
Before today (July 23), TSLA stock had declined 15% this year to trade at $374.01 U.S. per share.
Tech Insider
