If net income is the standard, the second quarter wasn’t kind to Tesla Inc.
Tesla, based in Austin, Texas, said this week it’s net income dropped some 45% compared to last year. Price cuts and low-interest financing couldn’t keep the company’s electric vehicle sales from falling.
The company said earlier this week it made $1.48 billion from April through June, less than the $2.7 billion it made in the same period of 2023. According to an Associated Press report, it was Tesla’s second-straight quarterly net-income decline.
Second quarter revenue, up 2% to $25.5 billion, was better than Wall Street estimates of $24.54 billion, according to FactSet.
According to the AP, Tesla said it sold 443,956 vehicles from April through June, down 4.8% from 466,140 sold the same period a year ago. Although the sales were better than the 436,000 that analysts had expected, they still were a sign of weakening demand for the company’s aging product lineup. For the first half of the year, Tesla has sold about 831,000 vehicles worldwide, far short of the more than 1.8 million for the full year that CEO Elon Musk predicted.
The company’s widely watched gross profit margin, the percentage of revenue it gets to keep after expenses, fell once again to 18%. A year ago it was 18.2%, and it peaked at 29.1% in the first quarter of 2022. Tesla said it posted record quarterly revenue “despite a difficult operating environment.” The company’s energy-storage business took in just over $3 billion in revenue, double the amount in the same period last year.
Shares of Tesla fell 4% in trading after Tuesday’s closing bell. The shares had been down more than 40% earlier in the year, but have since recovered most of the losses.
