Tesla ( TSLA ) reported mixed third-quarter results after the bell on Wednesday, but shares were buoyed by investors’ earnings beat, higher gross margins and news that Tesla’s cheapest EV is on track for production next year.
Tesla’s volume growth next year will be 20-30%, CEO Elon Musk said on an earnings call.
Tesla shares rose more than 11% in premarket trading on Thursday, set to add up to $80 billion to the company’s market valuation.
For the quarter, Tesla posted revenue of $25.18 billion vs. the Bloomberg consensus of $25.4 billion, which was higher than the $25.05 billion it reported in Q2 and topped the $23.40 billion Tesla reported a year ago. Tesla posted adjusted EPS of $0.72 and expected $0.60 on net income of $2.5 billion and free cash flow of $2.9 billion.
The closely watched gross margin figure was 19.8%, higher than the expected 16.8%.
“We delivered strong results in Q3 with continued and year-over-year growth in vehicle deliveries, resulting in record third-quarter volumes,” the company said in its earnings platform. “Preparations are underway for the delivery of our new vehicles – including the most affordable models – which we will begin in the first half of 2025.”
Earlier this month, Tesla reported third-quarter deliveries that slightly missed expectations, sending shares lower.
Tesla said it delivered 462,890 vehicles in Q3, up 6.4% quarter-on-quarter, marking its first quarter of delivery growth this year. These numbers come on top of the 435,059 EVs the company delivered in the year-ago period. But Wall Street expected Tesla to deliver closer to 463,897, according to Bloomberg.
“The updated Model 3 ramp continued successfully in Q3 with higher total production and lower cost of goods sold over the quarter. Cybertruck production increased sequentially and achieved a positive gross margin for the first time,” Tesla said in its statement.
Tesla said it expects vehicle deliveries to experience “slight growth” in 2024. CEO Elon Musk added during the conference call that 20-30% growth is possible next year.
Shares fell roughly 11% ahead of Tesla’s Q3 reveal on Oct. 10, when Tesla unveiled its robotaxi from the Warner Bros. studio lot in Burbank, Calif., at its lavish “We, Robot” event dubbed the Cybercab.
Investors and analysts are getting more details and detailed test plans from Tesla’s “We the Robot” event at the Cyberspace, Tesla’s companion $30,000 EV, dubbed the Model 2.
