To the surprise of Wall Street analysts, Tesla (TSLA) delivered more electric vehicles than expected in the second quarter of the year despite major layoffs and rising competition. The Elon Musk-led automaker today (July 2) reported delivering 443,956 vehicles between April and June, up nearly 15 percent from the first quarter and beating analyst estimates of 439,000.
The news sent Tesla shares up by more than 8 percent today to its highest level since early January. “This was a huge comeback performance from Tesla and Musk with the Street expecting a clear miss this quarter with EV demand still choppy globally,” said Dan Ives, an analyst with Wedbush Securities, in an investor note.
However, Tesla is still struggling to regain momentum after a tough few months. The automaker’s second-quarter deliveries are down nearly 5 percent from the same period last year, while its production of 410,831 vehicles shows a 14 percent drop. The decline follows its disappointing quarterly sales in the first three months of the year, which dipped for the first time in nearly four years in part due to an arson attack at Tesla’s Gigafactory in Berlin and shipping diversions caused by conflict in the Red Sea.
During the past quarter, Tesla delivered 422,405 Model 3 and Model Y vehicles and 21,551 other models. Tesla does not break out specific delivery figures for its Cybertruck, its newest model, but in June revealed that 11,688 have been sold since its release in November. That averages out to about 1,754 Cybertrucks per month.
Is Tesla leaving its tough times behind?
Tesla’s deliveries and production report comes amid a challenging period for the company, which has enacted a series of layoffs in recent months after a former bout of overhiring. Musk in April slashed more than 10 percent of his staff, around 14,000 employees, and has since dissolved the divisions of several major Tesla executives who departed the company earlier this year. The CEO is reportedly looking to reduce staff headcount by 20 percent in total, according to Bloomberg.
The Austin, Texas-based automaker is also dealing with rising competition. It is especially struggling to keep pace with rivals like BYD in China, which is its largest overseas market, and has slashed the prices of several vehicle models in a bid to stay dominant. This “pricing stabilization” has helped Tesla “battle through headwinds” in the region, said Wedbush’s Ives. However, local shipment from Tesla’s Shanghai Gigafactory dipped by more than 24 percent in June to 71,007 vehicles from a year ago, according to data released today by the China Passenger Car Association.
Turmoil within the company has coincided with Musk’s plans to shake up Tesla by reorienting it around robotics and artificial intelligence. “In a nutshell, the worst is in the rear-view mirror for Tesla” as EV demand returns and the company gears up to unveil its plans for a self-driving taxi concept later this year, according to Ives.
Tesla is expected to report second-quarter earnings on July 17. And on Aug. 8, the company will host an event dedicated to its design for a long-promised autonomous robotaxi.