Tesla Reports Second Profit Decline, Abandons 2025 Growth Guidance

Tesla has abandoned its 2025 growth projections after reporting a significant decline in vehicle deliveries, with decreases of 13% in Q1 and 13.5% in Q2, citing uncertain global trade and fiscal policies. Despite a global boom in electric vehicle sales, Tesla struggles partly due to brand image issues under Elon Musk’s leadership, which has reportedly alienated customers. The company’s free cash flow also dropped sharply, raising concerns among investors about its short- and medium-term financial health. Tesla’s traditional car and energy business is in decline, with increased competition from Chinese manufacturers and regional sales drops, particularly in Europe. Musk is focusing on long-term opportunities like robotaxi and humanoid robots, but these remain speculative and far in the future. Additionally, Tesla’s revenues from the car business fell by 16%, though a potential short-term boost could come from the impending expiration of US auto subsidies under President Donald Trump’s administration.