Tesla's Q2 Margin Slips Amid Price Cuts and Self-Driving Tech Push

Tesla's second-quarter margin declined due to ongoing price cuts and incentives aimed at boosting demand, which have affected profits. The company's automotive gross margin, excluding regulatory credits, was 14.65%, falling short of estimates. Tesla's revenue for the quarter was $25.50 billion, with net income down to $1.48 billion.

Tesla's second-quarter margin has fallen, impacted by continued price cuts and incentives aimed at spurring sagging demand. This has affected the bottom line as the company ramps up efforts in its self-driving technology sector, it announced on Tuesday.

During the third quarter, Tesla reported an automotive gross margin of 14.65%, excluding regulatory credits, missing the 16.29% estimate predicted by 20 analysts surveyed by Visible Alpha. The company's shares dropped by about 4% in after-hours trading.

For the three months ending in June, Tesla reported revenue of $25.50 billion, surpassing the $24.77 billion estimate from analysts but still showing only a marginal increase compared to last year's $24.93 billion. Net income fell to $1.48 billion from $2.70 billion a year earlier.