- Tesla reported Q2 earnings that missed by 38%, leading to a 14% drop in stock price.
- Vehicle deliveries reached a record 480,126 units, up 25% YOY and far exceeding analyst expectations of approximately 406,600.
- CEO Elon Musk expressed confidence in future growth, describing 2026 as a 'massive' capex year that will deliver 'incredible' returns.
- Musk highlighted that the Robotaxi rollout is scaling more than 10% per week in miles driven.
- Tesla confirmed that Cybercab production has begun at Gigafactory Texas, and the Robotaxi is now operating across seven major metropolitan areas.
- Musk confirmed volume production of Cybercab — a fully driverless vehicle — and framed Optimus as one of Tesla's largest-ever projects.
- Wall Street analysts maintain a mean price target of $409.03, implying compelling upside of 31%.
Tesla's second-quarter earnings report revealed a significant miss on earnings expectations, with non-GAAP EPS at $0.33, falling short of the $0.53 forecast by analysts.
This disappointing performance led to a 14% drop in stock price during after-hours trading.1
Despite the earnings miss, vehicle deliveries reached a record 480,126 units, a 25% increase year-over-year, surpassing analyst expectations of approximately 406,600.2
However, the company faced challenges as operating income collapsed 57% year-over-year to $398 million, with operating margins narrowing sharply to 1.4% from 4.1% a year ago.
Operating expenses surged by 47% to $4.35 billion, driven by increased spending on AI, Optimus, and Robotaxi infrastructure.
Additionally, free cash flow turned negative at -$1.1 billion, with capital expenditures soaring 142% year-over-year to $5.8 billion.
CEO Elon Musk remains optimistic, describing 2026 as a "massive" capex year that will yield "incredible" returns. He emphasized strong FSD adoption and a Robotaxi rollout that is scaling more than 10% per week in miles driven.
Tesla has also confirmed that Cybercab production has begun at Gigafactory Texas, with Robotaxi now operating in seven major metropolitan areas. Musk noted that volume production of Cybercab, a fully driverless vehicle, is underway, while framing Optimus as one of Tesla's largest projects, cautioning that the manufacturing ramp will follow a flat and prolonged S-curve due to the new supply chain being built.5
The mean price target of $409.03 suggests a potential upside of 31%, indicating that the market may be underpricing Tesla's future projects.7
“Vehicle deliveries hit a record 480,126 units in Q2, up 25% year-over-year, far surpassing analyst estimates of about 406,600. CEO Elon Musk said 2026 will be a 'massive' capex year and confirmed Cybercab production has begun at Gigafactory Texas with Robotaxi now operating across seven metro areas.”
