Tesla stock plunges 18% in worst week since 2022

Published Jul 29, 06:25 PM UTC

Tesla (NASDAQ: TSLA) experienced its worst weekly stock performance since 2022, falling 18% after its second-quarter earnings report. Despite achieving over $100 billion in trailing-12-month sales for the first time and delivering 480,126 vehicles in Q2 (up 25% year-over-year), investors reacted negatively to shrinking margins and heavy spending plans. Operating margins fell to just 1.4% from 4.1% a year ago, while operating expenses surged 47% to $4.35 billion. The company reported negative free cash flow of $1.1 billion and saw cash reserves drop by $1.2 billion. Tesla announced $25 billion in capital expenditure guidance for the year and plans to borrow up to $30 billion. The market is balking at Elon Musk's ambitious investments in autonomous driving (robotaxis) and the Optimus robot line, which require significant AI spending. CEO Elon Musk's net worth fell to $709 billion, losing more money in six weeks than any other billionaire possesses.