Tesla (TSLA) reported better-than-expected third-quarter earnings, with free cash flow and capital spending beating Wall Street estimates.
Tesla reported third-quarter revenue of $28.05 billion, compared to the Bloomberg consensus of $28.13 billion. Tesla reported adjusted EPS of $0.48 versus estimates of $0.44, with adjusted EBITDA of $3.90 billion versus $3.66 billion.
Tesla stock rose after hours.
386.47 +12.76 (+3.41%)
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387.46 +0.99 (+0.26%)
Tesla reported free cash flow of $1.53 billion versus -$4.92 billion estimated, with capital expenditures climbing to $4.732 billion versus $7.96 billion estimated for the quarter.
Tesla revealed that its Optimus robot has started production at its Fremont factory. “Even as we continue to improve the hardware and manufacturing process, we have proven that Optimus’ current manufacturing process is suitable for a commercial product,” the company said in its earnings release.
As for its other AI efforts, Tesla said it plans to reach 400 MW of AI training computing by the end of the year. Tesla said its active FSD (full self-driving) subscriptions had climbed to 1.74 million.
Tesla has planned capital spending of more than $25 billion for 2026, up from about $8.5 billion spent last year. The money goes to Optimus production lines, AI computing, the Cybercab ramp and the Terafab chip factory that Tesla is building with SpaceX.
CEO Elon Musk also recently stirred the pot by commenting on a possible tie-up with SpaceX, his other company.
“I think SpaceX and Tesla have formed special committees to discuss this idea,” Musk said during SpaceX’s earnings conference call Tuesday evening. “At the request of shareholders, and these special committees are composed of independent directors. And because I am a disputing party, I cannot participate in the special committee discussions.”
He added: “I don’t think we should necessarily assume that some people assume that a merger between SpaceX and Tesla is a certainty. And I think that would be a stretch. Do I think that would be a good idea? Yes.”
Tesla deliveries announced in the third quarter of 486,532, down 2% from a year ago but well ahead of the Bloomberg consensus of 463,000. Energy storage deployments totaled 13.7 GWh, up from 12.5 GWh a year ago and 13.5 GWh in the second quarter.
Tesla’s sales in its key territories are moving in different directions. The United States is still feeling the loss of the $7,500 federal tax credit for electric vehicles, which sparked a purchasing rush in the third quarter of last year before it expired. Cox Automobile estimates that Tesla sold approximately 144.1 thousand electric vehicles in the United States in the third quarter, down almost 20% year-over-year. That still represented about 54% of the U.S. electric vehicle market, more than all other brands combined.
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