The stock price of electric car manufacturer Tesla dropped over 7% on Thursday following a conference call in which CEO Elon Musk and other corporate officials signalled there would be a decrease in production during the third quarter as a result of factory improvements. Additionally, investors were unconvinced by the initial good news owing to some ambiguity among Musk and other executives about the soon-to-be-released Cybertruck and the development of an autonomous vehicle meant for use in taxi services.
Tesla shares dropped more than 7% on Thursday, falling to their worst one-day performance in three months. This shift came as investors reacted to CEO Elon Musk and other company executives providing inexact details in their earnings report about the Cybertruck, theelectric vehicle manufacturer's latest vehicle, as well as a planned robotaxi-ready car. Musk also mentioned that due to factory updates, the company will be targeting 1.8 million vehicle deliveries this year, although they anticipate that Q3 production will be slightly lower. Analysts are also wary of headwinds for margins, as the 9.6% from the past five quarters was the lowest result. Mark Delaney of Goldman Sachs expressed his concern with lowering prices to bolster volumes, which could potentially cause margin headwinds over the intermediate term. By Wednesday's closing price of $291.26, Tesla stock had slightly recovered from its overnight lows, but it remains lower than it was prior to the earnings report. Tesla's second quarter financials came in above expectations, as the company reported a revenue of $24.93 billion and an adjusted earnings per share of 91 cents. In terms of vehicle deliveries, the company announced a total of 466,140 for the quarter ended June 30, 2023, although the amount of Cybertrucks sold remains a mystery. Despite Tesla's announcement that factory tooling for its new truck is on schedule, they are only producing "release candidate" builds.
CNBC's Lora Kolodny and Michael Bloom contributed to this report.
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