Tesla reported a sharp drop in quarterly profit for the fourth consecutive time on Wednesday, even as revenues climbed, sending the company’s shares down more than 3% in after-hours trading. CEO Elon Musk sought to reassure investors by touting Tesla’s future in robotaxis, artificial intelligence, and humanoid robots.
For the third quarter, Tesla’s earnings fell 37% to $1.4 billion (€1.18 billion), compared to $2.2 billion (€1.9 billion) in the same period last year. Revenue, however, rose to $28.1 billion (€24.2 billion) from $25.2 billion (€21.7 billion), buoyed by a surge in electric vehicle (EV) sales and growth in its battery storage and charging businesses.
The sales uptick came after a difficult start to the year marked by weakening demand and boycotts linked to Musk’s political views. Analysts cautioned that some of the recent gains may have been temporary, as customers rushed to buy vehicles before a $7,500 U.S. federal EV tax credit expired on October 1.
“It’s positive that Tesla is diversifying beyond cars, but our primary concern remains EV demand,” said Garrett Nelson, an analyst at CFRA Research. “There’s still a lot of uncertainty.”
On an adjusted basis, Tesla earned 50 cents per share, down from 72 cents a year earlier and below Wall Street’s forecast of 56 cents. Gross margins stood at 18%, the highest level so far this year but still down from 25% four years ago, as the company continued offering price cuts and incentives to compete with rival automakers.
During a conference call with investors, Musk shifted focus from vehicle sales to Tesla’s upcoming robotaxi service and its humanoid robot project, Optimus. He described the robot as “so real that you’ll need to poke it,” predicting that what he called a “robot army” would become “the biggest product of all time.”
Musk added that he expects to remove human safety monitors from the robotaxi’s driver seat in Texas by the end of the year, with plans to expand the service to as many as ten other U.S. cities, including San Francisco.
Despite Musk’s optimism, Tesla faces mounting pressure to sustain growth. The billionaire had predicted 20–30% sales growth for 2025 last year, but those forecasts have not materialised. Critics say Tesla’s aging vehicle lineup and lack of new affordable models are weighing on demand.
Earlier this month, Tesla unveiled cheaper versions of its Model Y and Model X, both priced under $40,000 (€35,000). However, investors were underwhelmed, saying the discounts were not deep enough to attract new buyers.
Still, some analysts remain confident in Tesla’s long-term prospects. “It’s nice to have revenue come back,” said Brian Mulberry, senior portfolio manager at Zacks Investment Management. “There is still strong demand for Teslas.”
