Leading analysts have expressed concerns regarding Tesla’s current direction following the company’s second-quarter earnings call. The call flagged a range of issues, including unclear metrics, financial strains, and mounting legal concerns.
Key Takeaways from the Earnings Call
- Analysts highlighted the absence of clear metrics about what to expect from Tesla’s robotaxis in Austin.
- Concerns were raised about the company’s need to fund autonomy from its balance sheet until it reaches scale, which may impact profits over the next year.
- Investor and podcaster Amit Kukreja noted that the call confirmed the affordable model is a smaller Model Y, fueling concerns of cannibalization.
- CEO Elon Musk warned of hiccups for the next four quarters before material unit economic changes from robotaxi.
Analyst Reactions
- Gene Munster, managing partner at Deepwater Asset Management, noted that the stock was down almost 4.3% during the call, citing a steady decline throughout the call.
- Amit Kukreja stated that if you’re a bull, there’s nothing new, but if you’re a bear, you’ll likely continue to be bearish, calling Tesla “rangebound until meaningful earnings growth.”
- Fred Lambert, Editor-in-Chief of Electrek, had a blunt critique of the call, saying it was a “shit show” with potentially a lie per minute.
Financial Performance
- Tesla reported $22.5 billion in revenue, down 12% year-over-year, and missing consensus estimates at $22.8 billion.
- The company reported a profit of $0.40 per share, again missing Street estimates at $0.42.
Price Action
- The company’s shares were up 0.14% on the day of the earnings call but down 4.44% after hours.
- According to Benzinga’s Edge Stock Rankings, Tesla shares score well on Growth but lag on other fronts, with a favorable price trend in the short, medium, and long terms.
Outlook
The next few quarters are expected to be challenging for Tesla, with or without Elon Musk at the helm. The company’s autonomous taxi business may not be a giant profit center, and scaling in this space is expected to be expensive, with fierce competition.