Tesla's price war is hurting its bottom line more than ever — and Elon Musk is prepared to keep going
analyst expectations to about 18.2% and its quarterly gross profit margins dropped over 10% year over year, with analysts blaming the price cuts. The company's operating margin also fell to 9.6% from 14.6% during the same period the previous year.sell its cars for"zero profit"
due to the future profitability of FSD. He also said it was"ridiculous" the company has positive free cash flow at all as it seeks to rapidly invest in new technologies and products. Despite concerns about price cuts, Tesla's profits climbed during the second quarter, beating Wall Street estimates. The electric-car maker reported adjusted earnings of about $3.1 billion, or 91 cents a share, up 20% from the same time the previous year.
"New car prices and profit margins both declined once again and, while expected, investors are digesting the extent of difficulty EV car sales have become this year, versus 2022," Greg Bassuk, CEO at AXS Investments in New York, said in a note.Sign up for notifications from Insider! Stay up to date with what you want to know.
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