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New York: Tesla reported a big drop in quarterly profits Tuesday, pointing to elevated pressure on the electric vehicle market that has led to deep cost-cutting.

Elon Musk’s EV company reported profits of $1.1 billion, down 55 percent from the year-ago quarter on revenues of $21.3 billion, down nine percent.

After enjoying scorching growth for most of 2022 and 2023, the electric car maker, has encountered a tougher market in recent months as more competitors have introduced rival EVs, leading Musk to multiple price cuts over the last year or so.

ALSO READ: Tesla to lay off nearly 2,700 workers at factory in US Texas

The company, which recently announced plans to lay off more than 10 percent of its staff, has also undertaken a recall of its Cybertruck due to an acceleration problem.

Tesla is committed to “company-wide cost reduction” as part of an effort to achieve “profitable growth,“ it said.

In spite of the belt-tightening implied in those statements, Tesla’s report did provide some news likely to cheer investors, saying it planned to “accelerate the launch of new models ahead of our previously communicated start of production in the second half of 2025.”

The new vehicles will include “more affordable models,“ Tesla said.

The statement comes on the heels of speculation that Tesla is shelving plans for the “Model 2,“ the unofficial name of what is expected to be a mass-marketed, lower-priced vehicle.

Shares of Tesla rose 6.0 percent in after-hours trading.