Tesla reported a 12% increase in third-quarter revenue, rebounding after two consecutive periods of decline. However, the company’s earnings fell short of analyst expectations, leading to a roughly 2% drop in the stock price during extended trading. Tesla is an electric vehicle and clean energy company that designs, develops, manufactures, sells, and leases electric vehicles, as well as energy generation and storage systems. The company also operates a network of Supercharger stations to support its electric vehicles.
Total revenue for the quarter climbed to $28.10 billion, surpassing the estimated $26.37 billion. Automotive revenue saw a 6% increase, reaching $21.2 billion compared to $20 billion in the same period last year. However, net income experienced a significant drop of 37%, falling to $1.37 billion (39 cents per share) from $2.17 billion (62 cents per share) a year earlier. This decline in profit was attributed to lower electric vehicle prices and a 50% surge in operating expenses, partly due to investments in artificial intelligence and other research and development projects.
Despite the overall growth, Tesla faced challenges in Europe, where sales slumped amidst consumer concerns. Furthermore, the expiration of federal tax credits for electric vehicles at the end of the quarter impacted sales. Looking ahead, Tesla aims to commence ‘volume production’ of its Cybertruck, electric Semi trucks, and Megapack 3 energy storage system in 2026. The company is also progressing with ‘first generation production lines’ for its Optimus humanoid robots.
Earlier in October, Tesla introduced more affordable versions of its Model Y SUV and Model 3 sedan. These new offerings aim to make the company’s products more accessible following the expiration of the U.S. EV tax credit. The company’s energy generation and storage business emerged as a significant growth driver, with revenue surging by 44% to $3.42 billion. Elon Musk’s AI startup xAI, has been a big buyer of Tesla’s energy products.