Tesla’s third-quarter year-over-year revenue dropped by 39 percent in the United States for the third quarter, cratering from $5.13 billion last year to $3.13 billion.
CNBC reports that Tesla’s third-quarter revenue dropped by 39 percent in the United States this week, its first major drop in over two years. Sales in the United States, which accounts for the company’s largest share of total revenue, dropped from $5.13 billion last year to $3.13 this year.
Chinese sales rose by 64 percent to $669 million, however, while international sales rose to $1.83 billion. Wedbush analyst Dan Ives stated: “Musk & Co. are laser-focused on Europe and China for growth, while domestically, core demand is fading relative to other regions,” adding that U.S. growth will continue to remain a challenge for the firm.
In its recent earnings report, Tesla reported a nearly 8 percent drop in total revenue to $6.30 billion missing analysts’ average estimate of $6.33 billion. The company did, somehow, post a quarterly profit, however. The firm delivered a record 97,000 cars and says it will deliver between 360,000 to 400,000 vehicles for all of 2019. Elon Musk’s company stated that it was “highly confident in exceeding 360,000 deliveries this year.”
The sudden drop in domestic sales in the latest quarter compares with a 55 percent rise in the second quarter which ended in June. The firm forecasts capital expenditure to be just below $1.5 billion in 2019. Tesla stated that it had a provision for warranty of $138 million in the third quarter versus $187 million last year.
Roth Capital analyst Craig Irwin, who downgraded the stock to “sell” from “neutral,” stated that he sees the firm’s current margins as unsustainable. Tesla stock was down by nearly 3 percent at $318.66 at the time of the writing of this article.