Investing.com -- Tesla reported Tuesday second-quarter electric vehicle deliveries that were better-than-expected, and well above the number of vehicles produced, pointing to improved demand that likely eases concerns about excess inventory for its flagship Model 3/Y.
Tesla Inc (NASDAQ:TSLA) rallied more than 8% in recent trading on Tuesday.
Tesla deliveries, a close approximate to sales, were 443,956 in the second-quarter, topping Wall Street estimates of 438,000, stoking hopes that the worst of the weak EV demand backdrop may be in the rearview mirror.
The company produced around 410,831 vehicles, but while that was well below deliveries in the quarter, it is likely a positive, Oppenheimer said in a Tuesday note. "We view production well below deliveries as a positive for shares as it should alleviate concerns about TSLA building excess inventory for Model 3/Y," it added.
Concerns over excess inventory have been mounting after the Tesla reported in April that Q1 deliveries fell moire 8.5%, marking the first yearly decline in since 2000, amid rising competition in China.
Tesla electric vehicles in June fell by 24.2% year-over-year to 71,007 units, according to preliminary data released Tuesday by China’s Passenger Car Association.
The delivery update comes just weeks ahead of the Tesla's Q2 results due Jul. 23, where the focus will continue to be margins and up take of its self driving Full Self-Driving, or FSD, software. Tesla cut prices on its FSD software for a limited period to boost sales and many on Wall Street are keen for an update demand, or take rate.
Oppenheimer, however, flags Tesla's 'AI Day' slated for Sept. 30 as the key catalyst for the stock as it is expected to "articulate its vision for leveraging its underlying AI technology expertise."
Ahead of the AI day event, many are eagerly anticipating Tesla unveiling its robotaxi - the EV maker's self driving vehicle that is expected to boast its advanced FSD and autopilot software.
This content was originally published on Investing.com
