Tesla posts record Q2 revenue but profit falls 57%

Tesla reported record second-quarter revenue of $28.24 billion on July 22, up 26% year over year and ahead of Wall Street estimates, powered by its best-ever quarter of vehicle deliveries and a 50% jump in services revenue. Profitability slid sharply, however: GAAP operating income fell 57% to $398 million as operating margin narrowed to 1.4%, gross margin dropped to 16.8%, and non-GAAP earnings of $0.33 per share missed expectations amid lower average selling prices and a collapse in regulatory-credit revenue. Capital spending surged and free cash flow turned negative, and the shares fell more than 3% in after-hours trading.