Tesla shares plunged 18% this week to close at $313.03, their worst weekly slump since 2022, after the company reported weaker-than-expected second-quarter earnings. The drop capped a rough stretch for Elon Musk, whose SpaceX stock also slid ahead of a Starship test flight, erasing roughly $130 billion of his wealth.
Tesla shares plunged 18% during the week to close at $313.03 on Friday, their worst weekly slump since 2022. The stock is now down 30% for the year, by far the worst performer among tech’s megacaps.
Weak earnings drove the sell-off
The slide followed weaker-than-expected second-quarter results that the electric vehicle maker reported late Wednesday. The company turned cash flow negative after a surge in spending on futuristic projects such as robotaxis, humanoid robots and a giant chip fab.
Analysts at Argus Research, which has a hold rating on the stock, warned that the spending would pressure free cash flow and delay earnings growth without any near-term shareholder return. They added that consistent profit growth would be nearly impossible in the near term. For traders weighing the move, the essential guide to trading Tesla stock sets out how the shares behave.
A rough week for Musk
The two declines wiped away about $130 billion of Musk’s wealth, weeks after he had become the world’s first trillionaire. In a post on X, Musk wrote, “(Former) trillionaire.” His rocket company SpaceX also dropped 7.2% over five days to close at $115.07 on Friday, its lowest since the firm’s record IPO last month.
Starship test flight looms
On Friday evening, SpaceX will again attempt the 13th test flight of Starship, the largest rocket ever built or flown. The company had delayed a flight planned for Thursday because of weather, after scrubbing another attempt last week when the booster triggered a hold. A successful launch of the roughly 400-foot-tall Starship V3 would be the first since the company’s IPO.
Source: CNBC
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