(NewsNation) — Tesla’s second-quarter revenue fell short of analysts’ expectations as CEO Elon Musk prepares to face questions amid growing investor scrutiny.
The electric vehicle giant reported a 12% year-over-year drop in revenues, which fell to $22.5B for the April to June quarter, according to its earnings report released Wednesday. That marks the sharpest quarterly revenue decline in more than a decade, according to Reuters.
Wall Street analysts had estimated $22.6 billion for the quarter, according to Bloomberg.
Tesla attributed the revenue decline to a drop in vehicle deliveries, less money from regulatory credit sales and a lower average selling price for its vehicles.
Musk and other executives will host an earnings call with analysts at 5:30 p.m. ET, where they’re likely to face questions on robotaxis, full self-driving and Tesla’s long-promised affordable EV.
The company said in Wednesday’s investor presentation that it started initial production on a “more affordable model” in June, with volume production planned for the second half of the year.
Tesla investors aren’t excited about Elon Musk’s new political party
The weak earnings report comes at a challenging time for the company, which is grappling with intensifying global competition, looming federal hurdles and backlash over Musk’s political activity.
Earlier this month, the company reported a 13.5% year-over-year drop in vehicle deliveries for the second quarter, contradicting Musk’s claims that Tesla was seeing a “major rebound” in sales.
The American automaker is facing stiff competition, particularly in China, where Tesla has lost market share to low-cost local rivals.
Tesla sales plunge again as anti-Musk boycott shows staying power and rivals pounce on the weakness
Meanwhile, Tesla sales in Europe have taken a hit even as the electric car market continues to grow — a sign the company’s brand may be suffering amid controversy over Musk’s political views. Tesla stores across the U.S. have faced protests in response to Musk’s brief stint with the Trump administration, leading the Department of Government Efficiency (DOGE).
Musk and President Donald Trump eventually had a falling out and the Tesla CEO has since floated the idea of creating a new political party.
Trump’s “big beautiful bill” also poses a threat to Tesla by ending federal tax incentives for EV buyers — perks that have supported the company’s sales for years.
In June, Tesla began testing a robotaxi service in Austin, Texas and Musk has vowed that the service will quickly spread to other cities, eventually reaching hundreds of thousands, if not a million vehicles next year.
Something else to consider: Tesla may be more insulated from Trump’s tariffs than other automakers since it manufactures its U.S.-sold cars domestically, but it will still face import taxes on imported vehicle components.
This is a developing story that will continue to be updated.
The Associated Press contributed to this report.
