EV maker Tesla reported its overall revenue increased slightly in the second quarter, but it wasn’t because of its automotive operations, which fell 7%. The company reported net income and adjusted earnings were down year-over-year as well.
Tesla’s net income and adjusted earnings both fell during the second quarter as automotive revenue declined.
The Texas-based automaker took in $19.9 billion in revenue during the quarter, which was an improvement over Q1 results, but lagged the same period in 2023. Sales have been down through the first six months of the year, including being down 5% in the quarter just ended.
Overall, the company reported revenue of $25.5 billion, which is a 2% increase. However, Tesla’s net income came in at $1.48 billion, which is down 45%. Its EBITA-adjusted earnings were only slightly better at $3.67 billion, a 21% drop.
Car business
Tesla’s decline in vehicle deliveries came despite efforts to bolster Model 3 sales in the U.S. The company noted in its shareholder deck the refreshed Model 3 ramp up “continued successfully, including the introduction of Model 3 Performance in Q2 and Long Range Rear-Wheel Drive in July.”
Tesla sales tumbled in the month of June amid increases in the segment for rival automakers.
That said, the company delivered 443,956 Model 3 and Model Y vehicles in Q2, which was down 5% or a little more than 22,000 vehicles. Model S and Model X deliveries rose 12% year-over-year.
The results reflect the fact that the U.S. market is critical to Tesla’s success because despite a global increase in EV penetration during the quarter, the company’s deliveries and profits were down. However, the belief in EVs remains unflagging.
“Global EV penetration returned to growth in Q2 and is taking share from ICE vehicles,” the company said.
“We believe that a pure EV is the optimal vehicle design and will ultimately win over consumers as the myths on range, charging and service are debunked.
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Looking ahead
The company’s delivery numbers are expected to drop, in part, because of a lack of inventory of lower-priced models.
Officials offered an optimistic view of what lies ahead, although the tough times may carry on a bit longer. They believe Tesla’s between “two major growth waves.” The first one came with full production of the Model 3 and Model Y.
“(W)e believe the next one will be initiated by advances in autonomy and introduction of new products, including those built on our next generation vehicle and other products,” officials wrote.
In the meantime, Tesla says it has enough liquidity to continue with its product plans and capacity expansion.
Further, the plans for future vehicles, such as the second-generation Roadster and a lower-priced vehicle, remain on track for the second half of next year.
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