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Tech giants Tesla (Nasdaq: TSLA) and Alphabet (Nasdaq: GOOG), the parent company of Google, saw their shares tumble in early trading Wednesday following their second-quarter earnings reports. Despite both companies beating overall revenue expectations, investors reacted negatively to specific segments that fell short of analyst predictions.

As of 9:54 AM EDT, Tesla shares were down 11.36% at $218.38, while Alphabet shares dropped 3.83% to $176.57.
 

Tesla Posts Mixed Q2 Results

Tesla reported Q2 2024 earnings after market close on July 23, with revenue of $84.74 billion slightly surpassing the expected $84.19 billion.

However, the company’s core automotive business showed signs of strain, with revenue declining 7% year-over-year to $19.9 billion. Vehicle deliveries also fell 5% compared to the same period last year, totaling 443,956 units.

Despite the challenges in its automotive segment, Tesla saw significant growth in other areas. Energy storage and generation revenue doubled to $3.01 billion, while services and other revenue grew 21% to $2.61 billion. The company also achieved a record energy storage deployment of 9.4 GWh and announced that its Cybertruck became the best-selling EV pickup in the U.S. during Q2.
 

Alphabet Reports Strong Overall Performance in Q2 But YouTube Growth Lagged Expectations

Alphabet’s Q2 2024 earnings, also released on July 23, showed a 14% year-over-year increase in revenue to $84.74 billion. The company’s net income rose to $23.6 billion, or $1.89 per share, beating analyst expectations of $1.84 per share. Google Cloud was a particular bright spot, surpassing $10 billion in quarterly revenue for the first time.

However, while growing to $8.66 billion, YouTube ad revenue fell short of the $8.93 billion analysts had anticipated. This miss likely contributed to the negative market reaction.

Alphabet highlighted its continued focus on AI innovation and announced that its self-driving car unit, Waymo, is now making 50,000 weekly paid public rides. The company also committed a $5 billion multi-year investment to Waymo.

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