Tesla shares climbed early Monday, heading for a third straight day of gains after a tough period following the company’s second-quarter earnings. A new safety investigation by federal regulators does not seem to be affecting how investors feel about the stock.
The electric-vehicle maker’s shares were up about 1% in premarket trading, matching the modest gains seen in broader index futures.
If the stock rises Monday, it will be the third day in a row of gains. Last week, Tesla closed below $300 for the first time in over a year. The company’s weaker-than-expected second-quarter earnings, reported on July 22, led to a six-day losing streak and a drop of more than 20%.
Tesla reported an operating profit of about $400 million, which was about $1.3 billion less than Wall Street expected. Management also shared few new details about the company’s AI projects, such as its robotaxi and robotics programs. These areas have become more important to the stock’s performance than the main vehicle business.
Monday showed this trend again. Federal safety regulators recently started investigating more than a million Tesla vehicles because of a possible front suspension problem that could cause a part to come loose and create a dangerous driving situation.
In the past, news of a regulatory investigation might have caused a bigger drop in Tesla’s stock. However, investigations and recalls are common in the U.S. auto industry and usually come before any official action to fix a safety issue. Every year, millions of vehicles from many automakers are recalled as part of normal industry practice. These actions rarely have a big effect on stock prices and are usually just something investors keep an eye on, not a major reason for price changes.
