Tesla Stock Declines on Mixed Q2 Results, Affordable EVs Expected in 2025: Market Outlook & Future Prospects

Written by c, dora

Last updated: 2024-07-24

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Tesla Stock Declines on Mixed Q2 Results, Affordable EVs Expected in 2025: Market Outlook & Future Prospects

Tesla (TSLA) revealed mixed Q2 results, projecting a “notably lower” growth rate in 2024 compared to 2023. CEO Elon Musk unveiled a significant milestone, announcing the reveal date of the new robotaxi on 10/10.

This strategic update highlights the company’s evolution and future directions, attracting investors’ attention to its innovative roadmap.

Tesla Stock Dips on Mixed Q2 Results
Tesla Shares Dip 4% in After-Hours Trading
Robotaxi Debut: Unveiling on October 10th
Tesla’s Key to $1 Trillion Milestone
Vehicles Delivery Total for Q2

Tesla Stock Dips on Mixed Q2 Results

Tesla stock (TSLA) encountered a downward trajectory following the company’s announcement of mixed financial results for the second quarter. While Tesla reaffirmed its plans to launch a new, potentially lower-priced electric vehicle in the first half of 2025, investors were cautious due to the revelation that the EV maker expects a “notably lower” growth rate in 2024 compared to its achievements in 2023.

In detail, the quarterly results revealed a revenue of $25.05 billion, exceeding Bloomberg’s consensus estimate of $24.63 billion and slightly surpassing the $24.93 billion recorded a year earlier. However, adjusted earnings per share stood at $0.52, falling short of the expected $0.60, despite a non-GAAP net income of $1.8 billion. These mixed results have sparked market speculation and investor concern, leading to the decline in Tesla’s stock price.

Tesla Shares Dip 4% in After-Hours Trading

Despite announcing plans for new, more affordable models slated for production in early 2025, leveraging next-gen and current platform technologies, Tesla shares plummeted over 4% in after-hours trading.

The company assured investors that its production timeline remains unaltered, and the vehicles will roll off the same lines as its current models. Despite positive outlooks, the market responded with uncertainty, posing questions about future profitability and competition in the EV sector.

Robotaxi Debut: Unveiling on October 10th

On the earnings call, Musk revealed that the additional time would allow Tesla to incorporate “a couple other things” into the robotaxi, enhancing its capabilities and appeal.

This delayed unveiling also aligns with Tesla’s commitment to its “unboxed manufacturing strategy,” which promises to revolutionize the automotive industry.

Tesla’s Key to $1 Trillion Milestone

In a pivotal note released on Monday, Wedbush analyst Dan Ives emphasized the significance of Tesla’s AI/FSD advancements, stating that they are a crucial linchpin in the company’s journey towards a $1 trillion+ valuation and beyond in the coming year.

The analyst highlighted the importance of addressing the delay in Robotaxi Day and the new timing during the upcoming conference call, as it holds the potential to materialize the AI/FSD story into a lucrative monetization path in the years ahead.

As Tesla continues to innovate and disrupt the automotive industry, its AI/FSD capabilities are at the forefront of this transformation. The company’s advancements in autonomous driving technology are not only revolutionizing the way we travel, but they are also paving the way for new revenue streams and growth opportunities.

In addition to its AI/FSD progress, Tesla also reported significant progress in other areas of its business. The company announced that Cybertruck production has more than tripled compared to Q1, and the vehicle is expected to achieve profitability by the end of the year.

Furthermore, Tesla’s Semi factory is on track to begin production by the end of 2025, further expanding its electric vehicle lineup.

Vehicles Delivery Total for Q2

Tesla delivered an impressive 443,956 vehicles globally in Q2, surpassing the Bloomberg consensus estimate of 439,302, though slightly down from the previous year’s figures. Despite this slight dip, the delivery total marked a significant rebound from the 386,810 vehicles delivered in Q1, which had raised concerns about Tesla’s demand trajectory.

Analysts are now optimistic, with Ives stating, “We believe the Tesla demand story has shifted positively after a challenging 6-9 months, with the stronger-than-expected Q2 deliveries marking a major ‘turning point’ for the company’s bullish narrative looking ahead to 2H24/2025.”

A particularly noteworthy aspect of Tesla’s Q2 report was the revelation that it deployed 9.4 GWh of battery energy storage, representing its highest quarterly figure ever and more than double the amount deployed in Q1.

This impressive feat has been dubbed a “show stealer” by Morgan Stanley’s Adam Jonas, who noted that the 9.4 GWh figure surpassed the firm’s Predictions by double. This substantial increase in battery deployment underscores Tesla’s commitment to renewable energy and sustainable practices, further strengthening its position as a leader in the electric vehicle and renewable energy industries.