After what has been a tumultuous month for Tesla with disappointments surrounding it’s vehicle delivery numbers and the widely criticised robotaxi day event, there were positive signs for investors as the electric vehicle maker exceeded Wall Street’s expectations for the third quarter of 2024.
Following the vehicle delivery numbers and the robotaxi day event, shares fell by 3% and 9% respectively.
While many expected this downward trend to continue – a consensus formed that Tesla was going to report its worst yearly net income since 2020 – the company posted strong earnings for Q3.
This saw its share price soar, with Tesla stock up 11% in premarket trading today. The electric vehicle manufacturer brought in $0.72 in adjusted earnings per share, exceeding analyst expectations of $0.60, while it also forecasted a growth in deliveries this year, followed by a big jump in 2025.
Elon Musk will be hoping that this is the start of a new streak in growth and that Tesla’s initial October mishaps are a thing of the past.
Tesla’s Q3 earnings show that the company continues to execute on its strategy, with a notable 9% rise in profit, even as revenue fell slightly short of estimates. This growth in profit, driven by lower costs per vehicle and impressive gross margins, highlights Tesla’s ability to navigate an increasingly competitive EV landscape. With the cost of goods sold per vehicle hitting a record low, the company is demonstrating operational efficiency, a key to long-term sustainability in the automotive sector.
Beyond the headlines of vehicle sales and profits, Tesla’s energy business is becoming a true powerhouse. The segment posted record gross margins of 30.5%, showcasing just how significant energy storage and solar solutions are to Tesla’s future. With the Megapack factory in Shanghai nearing completion and ambitious plans to double energy deployments next year, it’s clear that Tesla’s vision extends far beyond just vehicles. This diversification into energy is crucial, positioning Tesla as a leader not only in EVs but also in sustainable energy.
Looking ahead, Elon Musk’s optimism on future growth during the earnings call was palpable, with investors responding enthusiastically. Tesla’s plan to achieve 20-30% vehicle growth in 2025, along with the launch of more affordable models, is driving a renewed bullish sentiment. The stock’s post-earnings surge reflects a market that believes in Tesla’s long-term vision. As the company continues to ramp up production and introduce innovations like the Cybertruck, it’s clear that Tesla is positioning itself for another wave of growth in the coming years.
Tesla’s Q3 earnings report wasn’t just about profit – it highlighted the company’s constant innovation. From the Cybertruck’s first-time profitability to advancements in Full Self-Driving (FSD) technology, Tesla continues to push boundaries. Musk’s confidence in achieving fully autonomous driving by 2025 shows that Tesla is betting big on its future. Investors are buying into that vision, understanding that Tesla isn’t just an automaker – it’s a tech company at the forefront of multiple disruptive industries.
