Shares in Tesla Inc. fell more than 3% in late trading today after the electric car maker revealed a slump in vehicle sales, despite reporting quarterly earnings and revenue in line with or just ahead of market expectations.

For the quarter that ended on June 30, Tesla reported adjusted earnings per share of 40 cents, down 23% year-over-year, on revenue of $22.5 billion, down 12% year-over-year.

The headline figures were either in line with or just ahead of expectations depending on the forecast. Investing.com reported that analysts were looking for 40 cents per share and revenue of $22.4 billion, while Barron’s says that Wall Street was looking for 39 cents and $22.1 billion.

Vehicle deliveries were down 13% year-over-year to 384,112, with the Model 3 and Y seeing sales of 373,728 while other models saw sales of 10,394. The slump in sales saw Tesla report $16.7 billion in automotive revenue in the quarter, down 16% year-over-year.

Tesla’s energy generation and storage business also saw a decline in the quarter, with revenue down 7% year-over-year, to $2.8 billion, although notably, gross profit for the solar business hit a record high of $846 million.

In a rare bright spot, the company’s services and other business, which includes Tesla’s Supercharging network, vehicle maintenance and repairs, parts and accessories, used vehicle sales, insurance, retail merchandise and artificial intelligence-assisted customer support services, rose 17% year-over-year, to $3.05 billion.

Free cash flow plunged 89%, to $146 million, while operating cash flow fell 30% to $2.54 billion. Tesla ended the quarter with cash and investments of $36.8 billion, down $200 million quarter-over-quarter.

Though car sales may be down amid Tesla Chief Executive Officer Elon Musk’s continued attempts to make both sides of politics dislike him, the quarter was notable for the company for the debut of new services. It saw the launch of its first Robotaxi service in Austin, representing the start of its broader autonomy and robotics strategy. The quarter also included the first fully autonomous vehicle delivery to a customer, a milestone Tesla claims no other automaker has achieved.

The robotaxi service, in particular, has some analysts excited. Cantor Fitzgerald LP analyst Andres Sheppard, who has an “Overweight” rating on the stock, told Insider Monkey, “Overall, we continue see Tesla’s Robotaxi segment as a software-as-a-service, high-margin model and we expect TSLA to have the ability to rapidly scale following commercialization. We continue to believe that TSLA will capture a significant share of the autonomous driving and ride-sharing industries.”

Alongside autonomy, Tesla began early builds of a more affordable EV model in June, with volume production set for the second half of 2025. The company also reiterated that its Cybercab and semi-trailer truck are on track for volume production in 2026.

Tesla also continued to scale its AI infrastructure in the quarter and is now operating 67,000 H100-equivalent GPUs, as it positions software and fleet-based services as future profit drivers. Despite macroeconomic uncertainty, Tesla says it has sufficient liquidity to fund its product roadmap, expand capacity and remain resilient through shifting tariffs and fiscal conditions.

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