Key highlights:
- Tesla earned $0.48 per share in Q3, beating the expected $0.44. Revenue reached $28.05 billion, just below the $28.13 billion estimate. The company’s free cash flow soared to $1.53 billion, much better than Wall Street’s predicted negative $4.92 billion. Capital spending also stayed below forecasts.
- Tesla lowered its full-year capital spending plan from $25 billion to $20 billion but kept investing in AI, Optimus robots, Cybercab, and chip manufacturing.
- Progress continued for Tesla’s self-driving and robotics projects, though there are still questions about Cybercab regulations and a possible SpaceX merger.
Tesla missed revenue targets by a slim margin but beat expectations for earnings, EBITDA, and free cash flow. It also spent less than Wall Street guessed, which shows Tesla’s actual investments don’t always match the forecasts.
Tesla showed it’s moving forward with tech projects like Optimus robots, AI computing power, and its driverless Cybercab. Vehicle deliveries were lower than last year, and some regulators still aren’t sure about self-driving tech. The company talked about future spending, a potential SpaceX combination, and the long-awaited Roadster, keeping investors focused on both its current position and longer-term plans.
Financial Performance and Capital Spending Plans
Tesla reported $28.05 billion in third-quarter revenue, falling slightly short of the $28.13 billion expected. Adjusted earnings reached $0.48 per share, ahead of the $0.44 forecast. Adjusted EBITDA rose to $3.90 billion, beating estimates of $3.66 billion.
The standout was free cash flow, Tesla posted $1.53 billion, much better than the predicted negative $4.92 billion. Tesla’s capital spending came in at $4.73 billion, way below the $7.96 billion guess. Investors reacted with after-hours volatility, weighing the earnings beat against the tiny revenue miss and the company’s possible future investments.
Tesla reduced its full-year capital spending target to $20 billion from $25 billion. CFO Vaibhav Taneja explained the change came from better capital management, saying Tesla plans to pay for its projects mainly with cash from its own operations.
The lower forecast does not mean Tesla is abandoning its expansion plans. The company is directing investment towards Optimus production lines, AI computing, the Cybercab rollout and the Terafab chip plant being developed with SpaceX. CEO Elon Musk said capital spending is a bit lower than expected for now but could ramp up next year, reaching tens of billions by 2028.
Tesla delivered 486,532 vehicles this quarter, a 2% drop from last year but above Bloomberg’s 463,000 estimate. Energy storage hit 13.7 GWh, up from 12.5 GWh in Q3 last year and 13.5 GWh in Q2. So, there’s a mix of ups and downs in Tesla’s car and energy businesses.
Robotics, Robotaxis and Future Technology Projects
Tesla started making its Optimus humanoid robot at the Fremont factory. The company says the current production setup fits commercial use, but there’s still improvement to come in hardware and manufacturing. Musk guessed it could take more than a year to ramp up to 1 million robots per year, targeting 20,000 units weekly. He hinted a demo video could come out soon, making clear he didn’t want the robot to move in a scripted way.
AI is expanding, too; Tesla expects to hit 400 MW of AI computing power by year-end. Active Full Self-Driving subscriptions now stand at 1.74 million. Musk called FSD the top draw for customers, showing just how central self-driving tech is for Tesla.
Robotaxi operations are picking up pace. Musk noted the Cybercab fleet in Austin has grown tenfold. Still, regulators have concerns since the Cybercab doesn’t have a steering wheel or pedals. The National Highway Traffic Safety Administration sent Tesla a special order with 21 questions about how Cybercab passed safety standards. Tesla asked for more time until November 20, but regulators gave an extra 30 days and set an October 30 deadline.
A possible Tesla-SpaceX merger is still being discussed. Musk said independent director committees at both companies are reviewing the idea at shareholders’ request. He called the merger possibly beneficial, but emphasized it’s far from guaranteed. No more details came up during the earnings call.
Tesla also showed off its delayed Roadster at SpaceX in Waco, Texas. Using cold-gas thrusters, the car leaped over several Teslas, including a Semi. The Roadster hit 0–60 mph in 0.81 seconds, and Musk said production starts in 2028. Commercial prospects aren’t clear though. Deepwater’s Gene Munster considers it an engineering showcase with little sales value, while Morningstar expects yearly sales to stay under 2,000 units.
