• Tesla reported better-than-expected profit in its third-quarter earnings report on Wednesday, with earnings per share of $0.72 adjusted versus $0.58 expected
• Revenue came in slightly below expectations at $25.18 billion versus $25.37 billion expected, but increased 8% year-over-year
• Tesla’s profit margins were bolstered by $739 million in automotive regulatory credit revenue during the quarter, and the company offered an array of discounts and incentives to spur sales
Tesla reported better-than-expected third quarter earnings on Wednesday, topping analyst estimates for profit while revenue came in just shy of expectations. The electric vehicle maker’s stock rose in extended trading following a deep slump this month.
Financial Results
For the third quarter, Tesla reported the following results:
- Earnings per share: $0.72 adjusted vs $0.58 expected
- Revenue: $25.18 billion vs $25.37 billion expected
Revenue increased 8% compared to $23.35 billion in the same quarter last year. Net income rose to about $2.17 billion, up from $1.85 billion a year ago.
Tesla’s profit margins benefited from $739 million in regulatory credit revenue. The company has also offered discounts and incentives to boost sales.
Key Business Segments
- Automotive revenue increased 2% to $20 billion, up from $19.63 billion last year
- Energy generation and storage revenue jumped 52% to $2.38 billion
- Services and other revenue grew 29% to $2.79 billion
Production and Deliveries
Tesla said it reached 7 million vehicles produced total on October 22. The company delivered 462,890 electric vehicles in Q3, up 6% from last year but below analyst projections.
For 2024, Tesla reiterated its goal of achieving slight growth in deliveries despite macroeconomic conditions. It also plans to launch more affordable models in early 2025.
Competitive Landscape
Tesla faces growing competition in China from automakers like BYD and Geely. In the US, Ford and GM are ramping up EV production.
Looking Ahead
The earnings report comes after Tesla’s “Optimus” robot reveal disappointed some investors seeking more specifics. It also lands just weeks before the presidential election, which CEO Elon Musk has been heavily involved in supporting former President Donald Trump.
According to investor questions, shareholders want to know how Musk’s political activism could impact Tesla. The stock was down 18% in October prior to Wednesday’s after-hours surge.
For the year, Tesla shares are still down 14% while the Nasdaq is up 22% over the same period.
Conclusion
Tesla topped profit expectations for the third quarter and saw growth in key business segments like energy storage. However, automotive revenue growth slowed and vehicle deliveries missed analyst forecasts. Looking ahead, Tesla faces a more competitive EV market and economic uncertainty even as it aims to boost production and launch new models.
