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Elon Musk faced the biggest drop in Tesla’s stock price in three months on last week, despite an earnings announcement on July 19 that beat Wall Street expectations on both earnings and revenue. The automaker saw revenues of $24.9 billion last quarter, with $3.1 billion in (non-GAAP) net earnings, according to the company.
It was an all-time high for quarterly revenue at the electric automobile manufacturer, and a 46% jump in YoY revenue.
Negative news from the quarterly call included the continuing decline of operating margins, now at 9.6%; operating income was actually down 3% on a YoY basis.
Tesla also did not deliver specific information about its planned Cybertruck vehicle. Musk personally responded to a question on the topic by saying, “it’s always difficult to predict the ramp initially, but I think we’ll be making them in high volume next year, and we will be delivering the car this year.”
Analysts had mixed reactions to Tesla’s quarter. Yahoo reported that Wedbush’s Dan Ives, who has a buy rating on the stock, asserted the results represent a “goldilocks 2Q print by Musk & Co.,” in a note to investors, while Citi’s Itay Michaeli, with a neutral rating, said, “We expect the shares to trade modestly lower as the current valuation likely needed a stronger Q2 outcome.”
But Tesla bears clearly won in the first 24 hours after the earnings release, and Guggenheim’s Ron Jewsikow, with a sell rating on Tesla, told Yahoo Finance, “Overall, while the print was better than feared, forward-looking pricing, production, operating leverage and demand commentary will likely weigh on shares following the considerable run in the stock.”