Tesla Revenue Falls 9% But Stock Jumps On Faster Affordable EV Timeline
Tesla reports its biggest revenue drop since 2012 alongside a 55% plunge in net income as ongoing price cuts weigh heavily on first-quarter financial results. Despite the weak earnings, shares surge after CEO Elon Musk announces an accelerated production schedule for more affordable vehicles.
Tesla reports a 9% drop in first-quarter revenue to $21.30 billion, marking the steepest decline for the electric vehicle maker since 2012. The company misses Wall Street expectations as ongoing price cuts significantly reduce its automotive revenue and push net income down 55% to $1.13 billion. This sales drop is even steeper than the decline Tesla experienced during the early days of the Covid-19 pandemic.
Despite the disappointing financial results, Tesla stock jumps in extended trading after CEO Elon Musk reveals an accelerated production timeline. Musk tells investors that the company starts building new, more affordable models in early 2025, or potentially even late this year, moving up the previous target by roughly six months. These new vehicles use the same manufacturing lines as Tesla's current lineup to fully utilize existing factory capacity.
Tesla also reiterates a pessimistic outlook for 2024, warning investors that its volume growth rate is notably lower than the growth achieved in 2023. The company faces intense pressure from weak delivery numbers and fierce competition in China, factors that already drive the stock down more than 40% this year. Additionally, Musk highlights ongoing investments in artificial intelligence infrastructure and mentions active talks with one major automaker to license Tesla's Full Self-Driving system.