Tesla shares plunge 13pc after losses shock and management shake-up
Tesla Inc. shares plummeted as much as 13pc after a worse-than-expected loss and yet another major management change cast fresh doubts on the electric-car maker's future.
Despite delivering a record number of vehicles in the second quarter, Tesla lost $1.12 (€1) a share, a bigger deficit than any analyst projected.
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While Chief Executive Officer Elon Musk is hoping to earn a profit in the three months ending in September, he told shareholders he'll prioritize other goals.
Then, for the second time already this year, Musk dropped a bombshell about a senior executive role change on a Tesla earnings call. Co-Founder J.B. Straubel, who's been with Tesla since before the billionaire CEO joined the board 15 years ago, is leaving the chief technology officer job and becoming an adviser.
The weak results and Straubel's step back risk undermining Musk's bid to sustainably make money building and selling electric cars.
Tesla's stock fell to as low as $230.80 shortly after the open of regular trading and is now down about 31% for the year.
The earnings miss is "calling into question the path to profitability from here," Ryan Brinkman, an analyst at JPMorgan, wrote in a report. He said Tesla is counting on selling more lower-priced Model 3s to make money, but posited that the car "may be structurally unprofitable."