Tesla’s stock falls more than 10% when its earnings fall short of forecasts.

The company also warned of sluggish production in 2024. January 25, 2024, 1:35 PM

Tesla’s stock tumbled more than 10% during afternoon trading on Thursday, less than a day after the firm revealed results that were below forecast and issued a warning about slow sales for the rest of the year.

According to the financial report that was made public on Wednesday, revenue and profits for the three months that ended in December fell short of analyst estimates.

According to the results report, the business delivered 1.81 million cars overall in 2023—more than it had in any prior year. However, Tesla has lowered its prices in response to heightened competition, which has negatively impacted the company’s earnings.

Furthermore, according to Tesla’s earnings announcement, the company’s increase in vehicle deliveries “may be notably lower” in 2024.

Gordon Johnson, the CEO and creator of analytics business GLJ Research, expressed his gloomy outlook on Tesla to investors in a note viewed by ABC News on Thursday. “Tesla is nothing more than a struggling car company,” Johnson said.

For its part, Tesla stated that the “next-generation vehicle” that it is working on would be released as early as the second half of 2025, is the reason for the slowdown. The business said that the upgraded car will boost sales.

The earnings report stated, “Our company is currently between two major growth waves.” “The first one began with the global expansion of the Model 3/Y platform and the next one we believe will be initiated by the global expansion of the next-generation vehicle platform.”

Despite being repeated in a conference call on Wednesday, the explanation did not alleviate the worries of Dan Ives, a managing director of equities research at Wedbush, an investment firm that is generally bullish on the company.

Ives said in a statement to ABC News that the conference call was a “trainwreck.”

Ives continued, “The earnings report has rattled the “near-term confidence” that Wedbush had previously endorsed.” “But we remain firm on a long-term bull thesis around Tesla and the broader AI story set to take hold,” he stated.

Elon Musk, the CEO of Tesla, gained notice this week when he threatened to pursue significant initiatives like artificial intelligence outside of the firm and stated in a post on X, formerly known as Twitter, that he is seeking more voting power within the electric vehicle manufacturer.

According to Musk, the Tesla board need to give him a 25% vote, which would almost quadruple the 25% of the vote that he presently gets from his ownership position in the business.

Government investigations of the corporation have also been related to the concerns associated with some of the technology in its cars.

Due to a safety concern with its autopilot technology, Tesla decided to recall roughly 2 million vehicles in December, according to the National Highway Traffic Safety Administration. Due to an issue with the assisted steering system, the business recalled an additional 1.6 million cars that were shipped to China earlier this month.

Ives described the uncertainties surrounding the company as a “bitter pill to swallow for the bulls.”