Investors paid close attention to Tesla’s third-quarter earnings release Wednesday afternoon, after CEO Elon Musk floated the idea of merging the automaker with his rocket and AI company, SpaceX. But they didn’t get any more information after the company said it wouldn’t ask any questions about it.
“As far as a possible merger with SpaceX, I think I said everything that needed to be said yesterday,” Musk, the CEO of both companies, said during Tesla’s earnings call. He repeated a phrase he said Tuesday: “I feel like I’m tap dancing through a minefield.” »
During a call with SpaceX investors on Tuesday, Musk said it would be a “good idea” to combine the two companies and that “it would bring a lot of merit.”
Musk said Tuesday that the boards of his two companies had set up special committees to study a possible merger, but had not yet reached an agreement on the terms of the transaction. The move would require approval from 50% of all Tesla shareholders.
On Wednesday, Tesla reported better-than-expected third-quarter earnings, with reported revenue of $28.05 billion and earnings per share of $0.48. That beat Wall Street’s forecast of $27.9 billion in revenue, with $0.43 in earnings per share. Still, the company reported slightly lower revenue than last quarter, which stood at $28.23 billion. And its automotive sales fell 3% from the previous year.
“We have maintained strong momentum on numerous projects spanning Super Intelligence (SI), robotics and renewable energy that will be critical to building a future of Incredible Abundance,” the company wrote in its report.
Despite a stronger-than-expected quarter, Tesla had a tough year with falling inventory and increased competition from cheaper Chinese automakers. The company’s stock price has fallen more than 11% this year, although it appears to have rebounded since last week with the announcement of a possible merger with SpaceX.
Last week, Musk revealed the company’s electric sports car, the Roadster 2, which he said uses SpaceX technology to “fly like a rocket.” In a demonstration at a SpaceX facility in Texas, a remote-controlled version of the car climbed a sharply curved ramp, then used jet-like thrusters to flip, hover and land. The price of the vehicle exceeds $200,000.
“Flying cars are real… They can fly like a rocket, they can do rolls, crazy gymnastics,” Musk said at the event, adding: “I’m not sure that’s necessarily legal in all jurisdictions.”
During Tesla’s earnings conference call Wednesday, he added that the event was “the coolest demo of any product.”
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Tesla’s vehicle sales are no longer as crucial to its market performance as they once were, as the company has shifted its focus to robotics, autonomous driving and AI. Tesla’s Optimus robot, however, has faced production hurdles; and its driverless taxi service, Robotaxi, has faced obstacles in growing its fleet and expanding to new cities.
“Tesla executives continue to make big statements about autonomous mobility and physical AI. The company has achieved some remarkable things but continues to miss some of its executives’ boldest bets,” said Paul Miller, principal analyst at market research firm Forrester. “Tesla robo-taxis are undeniably transporting passengers, but not yet anywhere near the levels the company promised.”
Musk has long said that Robotaxi will see near-infinite demand and that “probably half the population of the United States” will use the autonomous ride-hailing service by the end of 2025. Likewise, the CEO has predicted the manufacturing of a million Optimus robots each year. As Miller pointed out about Musk’s promises, he failed to achieve these lofty goals and the rollout was slow.
Musk once again touted robots on Wednesday, saying, “I remain convinced that Optimus will be the biggest product on earth and that humanoid robots in general will be the biggest product on earth.” » He added that no other company compares to Tesla in the development of humanoid robots – despite the considerable progress made by Chinese competitors in this technology.
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