Investors knew electric vehicle (EV) sales have been slumping for Tesla (TSLA 3.49%). The EV leader announced a 13.5% year-over-year drop in second-quarter deliveries on July 2. Yet the stock is tanking today after Tesla reported its full second-quarter financial update today.

Shares dropped as much as 10% before paring some of that loss. As of midday trading, Tesla stock was still down by about 9% after what was considered a disappointing report. Tesla bulls still might have a reason to buy the dip, however.

Tesla robotaxi outside shop on city street.

Image source: Tesla.

The robotaxi rollout is on track

While investors already knew deliveries were down 13.5%, there was further disappointment in seeing automotive revenue decline by 16% versus the year-ago period. That shows increasing pressure on vehicle pricing. Gross profit margin declined year over year as a result.

That wasn't the end of the bad news, either. Free cash flow was just $100 million in the second quarter. Even its previously fast-growing energy generation and storage business reported a 7.5% revenue drop versus last year.

CEO Elon Musk focused on the future in the earnings conference call, and Tesla bulls probably liked what he said. Musk stated: "I think we will probably have autonomous ride-hailing in probably half the population of the US by the end of the year. That's at least our goal, subject to regulatory approvals. I think we will technically be able to do it."

Pump the brakes on Tesla

Tesla's robotaxi business is what Tesla bulls are counting on. Some analysts think autonomous ride-hailing services could become a trillion-dollar business. While there could be much competition for that market, Tesla could become a major player, with voluminous amounts of data from its EVs already on the road.

Elon Musk has made bold predictions that haven't always materialized. Risk-tolerant investors might want to buy today's dip with a proper allocation based on that potential robotaxi market. But it shouldn't come as a surprise if the predicted rollout of Tesla robotaxis isn't as big or as fast as Musk predicted yesterday.