$TSLA

Tesla Stock in the Spotlight with Over 14% Drop ✨
Tesla stock experienced a sharp pullback of over 14% today following yesterday's earnings report. The stock fell to around $235 during the day, reaching its lowest level in nearly a year and ranking among the biggest losers in the S&P 500. Year-to-date losses have reached 28%, making it the weakest performer among the Magnificent Seven.
🔹 The stock fell 14.3% today to around $320.66, briefly reaching $235.
🔹 Q2 adjusted earnings per share were $0.33, compared to an expectation of $0.55, representing an approximately 18% year-over-year decrease.
🔹 Revenue was $28.2 billion, a 26% increase, exceeding expectations.
🔹 Gross margin narrowed to 16.9%, a contraction of over 2 percentage points.
🔹 Free cash flow was negative $1.1 billion, the first negative quarter in over two years.
🔹 Capital expenditures increased to approximately $6 billion in the quarter, almost doubling.
🔹 The full-year investment plan is over $25 billion, compared to $8.5 billion last year.
🔹 Morgan Stanley lowered its price target from $417 to $400.
Strong vehicle deliveries supported the revenue side in the balance sheet details. Deliveries increased by approximately 25 percent year-on-year to 480,126 units. However, the average selling price fell to $42,730, and regulatory credit income weakened. Operating expenses increased due to the rise in artificial intelligence.
The company describes 2026 as a year of significant investment. Investments in the Optimus robotaxi fleet, the humanoid robot, and the chip manufacturing facility are increasing cash flow. While management emphasizes its focus on creating long-term value, the market is pricing in the pressure on profitability.
In summary, although revenue exceeded expectations, weakness in profit and cash flow, along with the increased investment plan, put pressure on the stock, and the more than 14 percent drop is attributed to this situation.
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