Tesla beats 3rd-quarter earnings, revenue forecasts despite weaker auto sales
- Net profit falls 29% to $787M as electric vehicle maker increases spending on robotics, artificial intelligence
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- Net profit falls 29% to $787M as electric vehicle maker increases spending on robotics, artificial intelligence
By Mucahithan Avcioglu
ISTANBUL (AA) - US electric vehicle maker Tesla reported third-quarter earnings and revenue above market expectations Wednesday, despite weaker automotive sales and a sharp decline in net profit.
The company posted adjusted earnings of $0.48 per share, exceeding analysts' forecasts, while revenue totaled $28.05 billion, also beating market expectations.
However, revenue from Tesla's core automotive business fell 3% year-on-year to $20.56 billion, while energy revenue declined 16% to $2.88 billion.
Net income attributable to common shareholders dropped 29% to $787 million, or 22 cents per share, from $1.11 billion, or 32 cents per share, in the same period last year.
The decline in profitability came as Tesla increased spending on robotics and artificial intelligence initiatives.
Capital expenditures more than doubled from a year earlier to $3.73 billion, while free cash flow fell 62% to $1.53 billion.
Free cash flow nevertheless returned to positive territory after turning negative in the second quarter.
Tesla shares edged higher in extended trading following the earnings release.
The stock has declined 14% since the start of the year, underperforming other major technology companies.
- Potential SpaceX merger
The results came a day after Tesla Chief Executive Elon Musk expressed support for a potential merger between Tesla and SpaceX during the latter's quarterly earnings call.
Musk said the boards of both companies had formed special committees to discuss a possible combination, stressing that any transaction would require shareholder approval.
For Tesla, approval would require support representing 50% of all shares, a threshold Musk described as a significant hurdle.
The discussions come as Tesla expands its investments in robotics and artificial intelligence while facing declining revenue from its automotive and energy businesses.
Mücahithan Avcıoğlu