U.S. Markets Mixed as Tesla Dips 9% and IBM Falls 8% on Earnings Reports, Alphabet Surges 1.38% on Strong Results

The U.S. stock market experienced a mixed performance on July 24, 2025, as the Dow Jones Industrial Average slipped 0.43% amid a sharp selloff in IBM and Tesla shares, while the S&P 500 and Nasdaq rose on strong results from Alphabet. Tesla’s stock plummeted 9% following a significant earnings miss and cautionary remarks from CEO Elon Musk, dragging down investor sentiment. The automaker reported second-quarter revenue of $22.5 billion, falling short of the $22.64 billion forecast, with earnings per share at 40 cents against an estimated 42 cents [1]. The decline marked one of Tesla’s steepest drops in months, with its price sliding from $332.56 to $302.17 during premarket trading [1]. Musk attributed the challenges to the loss of electric vehicle incentives removed in a Trump-era tax bill and warned of “a few rough quarters” ahead due to weakening demand and high AI investment costs [1].

IBM also underperformed despite beating earnings expectations. The tech giant reported $2.80 per share, surpassing the $2.65 forecast, and exceeded revenue targets. However, its stock fell 8%, driven by slower-than-expected growth in high-margin software revenue [2]. Analysts highlighted that the decline reflected investor concerns over the company’s ability to sustain momentum in critical segments, despite otherwise strong financials [2].

Alphabet, in contrast, drove market gains with a 1.38% stock surge. The company reported $2.31 in earnings per share, above the $2.18 estimate, and exceeded revenue forecasts with $13.6 billion in cloud sales [3]. Google’s announcement of a $10 million increase in capital expenditures to meet cloud demand further boosted optimism, positioning it as a key beneficiary of AI-driven growth [3].

The divergent performances underscored sector-specific vulnerabilities. While the S&P 500 and Nasdaq benefited from tech resilience, the Dow Jones lagged due to IBM’s struggles and Tesla’s selloff. The Roundhill Magnificent Seven ETF, which tracks major tech and EV stocks, mirrored Tesla’s decline, signaling broader sector jitters [4]. Analysts noted that Tesla’s earnings miss highlighted the fragility of EV growth narratives, particularly as regulatory shifts and macroeconomic pressures reshape demand dynamics [4].

Musk’s warning of “rough quarters” intensified scrutiny over Tesla’s profitability, with the automaker’s CFO citing a $300 million quarterly cost increase from new tariffs tied to the Trump-era tax bill [1]. Meanwhile, American Airlines revised its 2025 forecast, reflecting broader economic headwinds that further fueled risk-off sentiment [5]. The selloff also impacted Musk’s personal wealth, which reportedly dropped $12 billion, amplifying concerns over his company’s long-term dominance [1].

The market’s mixed response highlighted the fragmented nature of corporate performance. Alphabet’s gains contrasted sharply with Tesla’s struggles, underscoring the challenges of balancing high-growth bets with margin pressures. Analysts emphasized that Tesla’s issues were emblematic of a broader transition phase in the EV industry, where regulatory and economic factors increasingly dictate outcomes [5].

Source:

[1] [Dow Jones drops, Tesla stock crushed on earnings miss](https://crypto.news/dow-jones-drops-tesla-stock-crushed-on-earnings-miss/)

[2] [Stock Market Today: Dow, S&P 500, Nasdaq trade mixed](https://finance.yahoo.com/news/live/stock-market-today-dow-sp-500-nasdaq-trade-mixed-as-wall-street-weighs-google-tesla-earnings-233839940.html)

[3] [Earnings live: American Airlines restores forecast, Tesla stock falls](https://finance.yahoo.com/news/live/earnings-live-american-airlines-restores-forecast-tesla-stock-falls-in-wake-of-earnings-miss-131622709.html)

[4] [Tesla Stock Slides After Q2 Miss and Musk's Warning](https://www.techi.com/tesla-stock-slides-q2-2025-miss-musk-warning/)

[5] [Stock Market Today: Netflix Triggers Short-Term Sell Rule](https://www.investors.com/market-trend/stock-market-today/dow-jones-sp500-nasdaq-tsla-stock-tesla-earnings/)