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Tesla stock suffers double-digit drop on carmaker’s worst day in years
Tesla has lost about 27% of its market value throughout the year. Photograph: Bloomberg/Getty Images View image in fullscreen Tesla has lost about 27% of its market value throughout the year. Photograph: Bloomberg/Getty Images Tesla stock suffers double-digit drop on carmaker’s worst day in years Elon Musk’s EV company lost a quarter of its value after revealing weak profits and high spending on AI and robotics Tesla ’s stock fell about 13.5% on Thursday in one of the biggest single-day market losses in the company’s history. Elon Musk ’s automaker has struggled throughout the year, losing about 27% of its market value as huge capital expenditures and weaker-than-expected profits worry investors. US stocks as a whole tumbled on Thursday with Nasdaq down more than 2% after touching its lowest level since early May as the latest earnings updates from large technology companies revived concerns about heavy AI spending, while soaring oil prices amped up inflation worries and pushed up bond yields. The S&P 500 and the Dow exchanges fell more than 1% after second-quarter results from Alphabet and Tesla, the first of the so-called “Magnificent Seven” megacap companies to report this season, failed to impress investors. Elon Musk says he got ‘carried away’ with Trump – but still holds on to contentious political views Read more Tesla’s market losses come the day after it released its second-quarter earnings , which revealed the company made 31 cents per share as opposed to the 51 cents per share that Wall Street analysts expected, a proxy measure for the company’s profitability. Though it did beat revenue predictions, a sharp selloff in Tesla stock has followed. Musk faced numerous questions from investors on Wednesday’s earnings call about the timeline and logistics of the two projects he has most heavily touted – Tesla’s driverless Robotaxi car service and Optimus humanoid robot. Musk has for years promoted both products as world-changing sources of near-infinite potential revenue, but the rollout has been slow and Musk has repeatedly failed to meet his own targets. Tesla’s Robotaxis are available only on a limited basis in the US, and Optimus is not available to consumers. Musk attempted to assuage investor concerns on Wednesday’s call by once again proclaiming that Optimus robots would be Tesla’s biggest product ever, but cautioned that there were numerous hurdles the company faced in creating the product. He similarly claimed that Robotaxi’s slow rollout was the result of an abundance of concern for safety and worry that deadly accidents would result in negative media attention and a regulatory crackdown. Tesla’s pivot to robotics, autonomous vehicles and AI has required immense amount of investments with little immediate return. The company spent $5.8bn in the second quarter of this year, resulting in negative free cashflow of $1.1bn for the first time in more than two years. Although its electric vehicle sales surged on the strength of Europea
