Tesla (TSLA, Financials) posted its steepest quarterly revenue decline in more than ten years, with sales down 12% year over year to $22.5 billion for the AprilJune period. The result missed analyst forecasts of $22.74 billion, according to LSEG data, and came amid growing concerns over CEO Elon Musk’s political involvement and its impact on the automaker’s global image.
Vehicle sales revenue fell 16% as deliveries dropped for a second straight quarter. Tesla previously reported a 14% decline in deliveries for the period. The company said the dip was tied to weakening demand despite the rollout of a refreshed Model Y SUV.
Tensions over Musk’s political activityincluding the launch of a new political party in the U.S. and ties to Germany’s far-right AfDhave weighed on Tesla’s reputation. Investor unease has deepened following executive departures, including the recent exit of a top manufacturing executive.
Still, Tesla is banking on long-term bets like robotaxis and AI. A limited trial of its robotaxi service began in Austin, Texas, last month, and Bloomberg reported new discussions with Nevada to expand the pilot. Musk’s AI firm, xAI, is also expected to play a growing role.
Analyst Dan Ives of Wedbush Securities told Al Jazeera that Tesla is at a positive crossroads and called Musk laser focused, citing stabilizing demand in China and the early stages of an aggressive AI strategy.
Tesla reaffirmed its AI ambitions despite the weak results, and shares closed up 0.1% on the day before falling 0.3% in after-hours trading.
This article first appeared on GuruFocus.
