Tesla has warned that while its revenue was nearly $1 billion above expectations, its quarterly profits dropped 45%.
👉 Background: Tesla is the OG electric vehicle company run by Elon Musk. While Tesla has led the pack for many years, almost all existing car makers have now created their own EV divisions - and the gap is narrowing.
👉 What happened: Now, Tesla has warned that while its revenue was nearly $1 billion above expectations, its quarterly profits dropped 45%. And this was the second straight quarter where Tesla had suffered a loss.
👉 What else: But the good news...apparently? Elon Musk reckons he can produce 20 billion humanoid robots that everyone on earth “is going to want” — he's now promoting his robots, Powerwalls and robotaxis ahead of his electric vehicles. Next minute: Tesla’s share price drops 12% - after investors aren’t really sure what Tesla’s core business is in anymore.
💡There is enormous risk when investors lose faith in a company's core business. Over the past 12 months, Tesla continues to shift the focus on what is "important" in its business.
💡On top of two consecutive quarterly profit declines, Tesla earned $890 million in government credit…which ain’t really a sustainable long-term business model.
💡And Tesla ain't the only company who has shifted from its core. Facebook's shift to the metaverse cost them more than $46 billion USD, but, luckily they were able to backtrack and re-focus. So after much speculation, Tesla will be hoping these other business lines get on the road ASAP.
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