Tesla plunges 15% to $319.69 after Q2 earnings miss

Published Jul 25, 04:57 PM UTC

Tesla shares dropped about 15% to $319.69 following a disappointing Q2 2026 earnings report, despite record revenue of $28.2 billion and 480,126 vehicle deliveries. Operating income fell 57% to $398 million, squeezing margins to 1.4%, as heavy spending on AI, robotaxis, and the Optimus robot program, along with a 67% drop in regulatory credit revenue, weighed on profits. Free cash flow turned negative at -$1.1 billion due to capital expenditures more than doubling to $5.8 billion. However, Wall Street analysts maintained an average price target of $412, implying 29% upside, with a consensus buy rating. The article questions whether the drop is a buying opportunity or reflects analysts' slow adjustment to Tesla's high spending and reliance on future high-margin businesses like software and robotaxis, given the stock still trades at about 300 times earnings.