Tesla stock rallied after hours on Tuesday after the earnings release, despite a sales miss in the first quarter of 2024, a sharp profit decline, and a recall of its recently launched $100,000 Cybertruck car. It rose nearly 10% in trading.
The electric vehicle maker’s sales were $21.3 billion, below expectations of $21.48 billion and down 9% from a year ago, the biggest decline since 2012. The company reported profit of $1.1 billion, down 55% from the first quarter of 2023. Said.
Still, the report provided encouraging announcements for investors, including a preview of a ride-hailing app that will be integrated into Tesla products. The company said it plans to launch new vehicle models sooner than previously announced, citing its robotaxi network in development. The company has more than doubled its AI computing (smart software complexity) in the past three months, and during the same period it has invested $1 billion in AI infrastructure.
Tuesday’s report, particularly Tesla’s plans to accelerate development of lower-cost cars, allayed some of those concerns, said Thomas Monteiro, the company’s senior analyst. Investing.com.
“This announcement signals that Elon may be refocusing his efforts on the EV giant, which is also good news for shareholders.” “It’s a positive sign for the company that Elon felt forced to change direction amidst myriad pressures.”
The earnings report is Tesla’s second since the launch of its long-awaited electric pickup truck, the Cybertruck, and the first since the vehicle was recalled last week. This futuristic steel car has been plagued by a long list of other failures. Tesla issued a voluntary recall after receiving reports that a loose accelerator pedal could cause vehicles to become stranded when driving at full speed. The company did not directly comment on the recall in its earnings release.
Even without the Cybertruck concerns, Tesla is already facing a difficult year and said last week: Reduced workforce by 10% worldwide, approximately 14,000 jobs. It cut prices around the world over the weekend. It has weathered a series of poor earnings reports in recent quarters as rival Chinese electric car makers have invaded the electric vehicle market. Tesla reported the first decline in car deliveries in four years last quarter. Tesla said in a report today that the growth rate in car sales “could be significantly lower than the growth rate achieved in 2023.”
Musk continues to battle continued criticism from investors that he is stretching himself too much after acquiring the social network Twitter (which he renamed X) in late 2022. The company and its products were in turmoil the following year. half. Meanwhile, Tesla asked shareholders to vote in favor of Musk’s $56 billion pay package, which was rejected earlier this year when a judge ruled it was an “incalculable sum.”
More details coming soon…
