ALBAWABA - Stocks of Chinese electric car companies have declined after Tesla revealed disappointing financial results and issued a negative outlook for the company's future.
This marks the first time Tesla has reported quarterly profits and revenues below expectations since the second quarter of 2019.
The company's earnings per share amounted to 66 cents, falling short of the expected 73 cents.
Revenues reached $23.35 billion, compared to analysts' expectations of $24.1 billion.
Shares of Chinese car companies listed in Hong Kong reacted to these results, with BYD and Xpeng stocks dropping by about 2.18% and 8.76%, respectively.
Nio's shares also fell by 8.3%, and Geely's by approximately 4%.
During the earnings announcement conference, Elon Musk warned that Tesla's electric truck would not yield substantial returns for the first 12 to 18 months of production.
He mentioned that the company is working on reducing car prices amid high-interest rates, but this poses a challenge for the company.
He added, "I'm concerned about the high-interest rate environment...Things will be much tougher for consumers to buy cars if interest rates go up significantly."
Tesla's stocks closed Wednesday's session down by 4.8%, and shares of other competing American companies like Lucid and Rivian also dropped by more than 9%.
