Tesla shares experienced an 8% increase following the release of its third-quarter earnings report on Wednesday. The electric vehicle giant rebounded from a challenging second quarter, surpassing Wall Street’s expectations for earnings per share. Tesla reported an EPS of $0.72, exceeding the projected $0.60.
Surge follows second quarter dip
At the end of the second quarter, CEO Elon Musk had attributed the nearly 50% drop in profits to short-term challenges, particularly competition from more affordable electric vehicles, including those from rivals like BYD. Musk had indicated that the profit dip was a temporary issue and not expected to persist in the long run.
However, Tesla’s revenue for the third quarter fell slightly short of forecasts. The company posted $25.18 billion in revenue, narrowly missing Wall Street’s expectation of $25.43 billion.
Tesla committed to growth
In a press release, Tesla emphasized its commitment to growth, despite economic challenges and the pullback of investments in electric vehicles by others. The company highlighted its focus on expanding its product lineup, reducing costs, and investing in AI projects and production capacity, which it believes will position it well to benefit from the ongoing transition in the transportation and energy industries.
Tesla delivered 462,890 vehicles in the third quarter, an increase from 443,956 in the second quarter. Investors are eager to learn whether the company remains on track to meet its 2023 vehicle delivery target of 1.8 million.
Tesla lanches robotaxis
Tesla has indicated that it expects modest growth in deliveries by year-end. Dan Ives of Wedbush Securities expressed optimism, noting that reaching the goal would be an impressive achievement given the challenges faced in the first half of the year.
Additionally, investors are seeking more information regarding Tesla’s robotaxis, especially after a disappointing launch event earlier this month. The event, which provided few concrete details, led to a nearly 9% drop in Tesla’s stock, wiping out over $60 billion in value. Tom Narayan, an analyst at the Royal Bank of Canada, commented that the event appeared more focused on promoting Musk’s vision than offering specific data for financial modeling, as typically expected at such unveilings.
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