Tesla reports 7% drop in auto revenue as earnings fall short of Wall Street estimates

Tesla reported weaker-than-expected earnings for the second quarter as automotive sales dropped for a second straight period. The stock slid more than 8% in extended trading.

Revenue increased 2% from $24.93 billion a year earlier, Tesla said in an investor deck on Tuesday. But automotive revenue dropped 7% to $19.9 billion from $21.27 billion in the same quarter a year ago. Auto revenue included regulatory credits of $890 million, more than triple the figure from last year.

The company said it "recognized record regulatory credit revenues in Q2," pointing to the fact that other automakers are "still behind on meeting emissions requirements."

After a rocky first half of the year that saw Tesla cut more than 10% of headcount, the company reported better-than-expected deliveries for the second quarter earlier this month. However, deliveries were still down from a year earlier for a second straight period.

CEO Elon Musk said, in opening remarks on Tuesday's earnings call that Tesla will host a robotaxi unveiling event on Oct. 10 Originally, he said the event would take place on Aug. 8.

Musk was asked in the Q&A portion of the call when shareholders can expect "the first robotaxi ride."

"I would be shocked if we cannot do it next year," Musk said, after first noting that his predictions have been "overly optimistic in the past."

Musk has been promising since about 2016 that Tesla will turn its existing EVs into self-driving vehicles with software updates, which the company calls Full Self-Driving. Tesla is separately working on a CyberCab dedicated robotaxi.

On Tuesday's call, Musk said he doesn't foresee regulatory hurdles to rolling out Tesla's self-driving technology to a broad market in the U.S. and beyond.

He also referred to