Tesla (NASDAQ:TSLA) reported its Q2 earnings results yesterday, with EPS of $0.91 coming in above the Street estimate of $0.79. Revenue was $24.93 billion, beating the Street estimate of $24.29 billion. Despite the beat, shares fell more than 4% pre-market today.

According to the analysts at JPMorgan, who reiterated their Underweight rating and $120 price target on Tesla stock, this was the fourth consecutive time the company missed its quarterly operating profit estimates, primarily due to the ongoing practice of prioritizing sales over profits.

The automotive adjusted gross margin, excluding the revenue generated from regulatory credits, has become a major focus for investors. Last quarter, this crucial performance indicator surprised investors by declining 1,100 basis points year-on-year, dropping from an impressive 30.0% in Q1/22 to 19.0% in Q1/23.