Tesla Missed Profit Targets. Musk's Bold Forecast Can't Save the Stock.

Dow Jones
3小时前

Tesla's earnings failed to wow investors, like SpaceX's results did. Shares were lower in early trading, despite a new bold claim from CEO Elon Musk.

Wednesday evening, Tesla reported fine third-quarter results. Automotive profit margins excluding the impact of regulatory credit sales were about 18%, better than Wall Street projected. But operating profit of $718 million, was down 56% year over year, missing Wall Street estimates of about $1.4 billion.

Still, sales were roughly flat year over year. The company's AI efforts have yet to yield material growth. (SpaceX's third-quarter sales grew 161% year over year.)

Tesla stock was down 4.5% in premarket trading at $369.16, while S&P 500 and Dow Jones Industrial Average were off 1% and 0.6%, respectively.

The drop came despite Musk's continued confidence in Tesla's AI strategy. Tesla uses AI to train cars to drive themselves and robots to do useful, labor-saving tasks.

Tesla launched a robo-taxi service in Austin, Texas, in June 2025, but scaling the business has been slow. Musk still sees a bright future, though.

"Unless we are stopped by governments, which is certainly a possibility, if they're trying to protect a domestic industry, I think Tesla will end up doing a majority of all passenger miles on Earth in any country where it is allowed to operate freely," said Musk. "And you can come back and look at this prediction, but I feel confident about this prediction."

A majority in the U.S. means robo-taxis driving more than 1.5 trillion miles per year. Today, Americans drive more than 3 trillion miles a year.

Musk is saying that, eventually, robo-taxis will be so cheap that people won't need to own cars. What's more, Tesla will win a majority of the market by offering the lowest cost hardware -- staring with its two-seat Cybercab -- while also having leading self-driving software.

Musk isn't the only one bullish on improving self driving technology. ARK Invest's Director of Investment Analysis, Tasha Keeney, sees low-cost robo-taxis changing consumer behavior. "Two-car households go to one car. One goes to zero," she tells Barron's. ARK is a big Tesla fan. The firm sees shares hitting $4,400 by 2031. Robo-taxis account for roughly 80% of the value.

Robo-taxis fundamentally changing the car market is still a long way away. For now, investors are concerned with the here and now.

There were positives in the quarter. Tesla battery storage business is sold out through the end of the year, and more people are paying for Tesla's Full Self-Driving driver assistance product.

Still, investors are waiting for more robo-taxis and robots.

Canaccord analyst George Gianarikas called Tesla the "Berkshire Hathaway of Tomorrowland," in a post-earnings report. That sounds pejorative, but Gianarikas is a Tesla bull, rating shares Buy. He believes the future will arrive. His price target is $442 a share.

The average analyst price target for Tesla stock is about $395 a share, up about $12 since the earnings report. Overall, analysts were fine with the results.

 

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