Tesla burns through 1.1 billion in cash. But it is growing through investment in AI and robotaxis
First fall in free cash flow in two years, following capital expenditure of 5.8 billion. However, in the quarter, Tesla reported a 26 per cent rise in revenue to 28 billion and delivered 480,126 vehicles, up from 384,122 in the same period last year and exceeding expectations.
Tesla continues to burn through cash. Elon Musk’s electric car, robotics and high-tech company ended the second quarter with a negative cash flow of $1.1 billion, the first time it has been in the red for over two years. However, the result was better than the negative $3.6 billion in free cash flow expected by analysts. Earnings were disappointing, with earnings per share of $0.33 compared with the expected $0.50. EBITDA, a measure of operating profit, stood at $3.27 billion compared with the forecast of $3 billion. The share price fell by 3 per cent in after-hours trading.
The figures reflect the surge in investment, which totalled $5.8 billion during the quarter, in infrastructure for artificial intelligence, batteries, robotaxis and new production systems. The group aims to reduce its reliance on car sales by strengthening its activities in the fields of autonomous driving, robotics and energy.
In terms of performance, however, Tesla was able to draw greater satisfaction from its turnover, which showed growth during the quarter: it rose by 26 per cent to 28 billion, exceeding expectations, with a 23 per cent increase in the automotive sector. It also recorded revenue of 100 billion for the first time over the last twelve months. Tesla delivered 480,126 vehicles, up 24.9% from the 384,122 delivered in the same period the previous year and exceeding Wall Street’s expectations.
Much of the growth took place in Europe, boosted by high petrol prices, whilst sales in the US, according to analysts, fell by 20 per cent. The Trump administration has put the brakes on policies for electric vehicles. Production stood at 451,758 units, with deliveries exceeding this figure by more than 28,000 vehicles.
Tesla’s energy division is also growing: the business generated 3 billion in revenue, up 13 per cent on last year. Tesla installed energy storage systems totalling 13.5 gigawatt-hours, compared with 8.8 GWh in the previous quarter and 9.6 GWh a year earlier.
