Tesla Reports Significant Profit Decline Despite Strong Sales
Tesla's latest financial results revealed a sharp drop in earnings, even as vehicle sales hit record levels in the most recent quarter.
A surge in electric vehicle purchases ahead of the expiration of a U.S. tax incentive helped boost the automaker’s previously slowing sales, allowing it to surpass certain Wall Street projections. However, Tesla still fell short of profit expectations, causing its stock to decline in after-hours trading.
On Wednesday, Tesla reported third-quarter earnings of 50 cents per share, below the 54 cents predicted by analysts. While revenue exceeded expectations at $26.457 billion, operating income was $1.62 billion compared to the anticipated $1.65 billion. Net income dropped 37% year-over-year to $1.4 billion from $2.2 billion.
The increase in deliveries was linked to consumers trying to secure expiring EV tax credits. The loss of these incentives, due to the discontinuation of a federal program, has previously affected Tesla’s relationship with policymakers and continues to shape its sales outlook.
In its earnings announcement, the company highlighted advancements in autonomous driving technology while acknowledging difficulties posed by evolving trade and economic policies.
The report arrives at a crucial moment for Tesla and CEO Elon Musk, who is seeking shareholder approval next month for an unprecedented $1 trillion compensation package. The deal hinges on Tesla meeting ambitious goals, including reaching an $8.5 trillion market valuation within a decade.
Despite Musk’s influential following, two major advisory firms—Glass Lewis and Institutional Shareholder Services—have urged investors to reject the pay package, deeming it excessive.
Meanwhile, Musk has been embroiled in controversy after mocking a U.S. transportation official, referring to him as "Sean Dummy" and amplifying calls for his removal. The official later announced plans to reopen contract bids for a major space mission due to delays in Musk’s SpaceX project.
Tesla’s shareholders will vote on the compensation package during a company meeting on November 6. In response to criticism, Tesla condemned the advisory firms’ recommendations, while Musk suggested he might step away from the company if the proposal is denied.
Read next
Meta, Google test: Do infinite scroll and autoplay foster addiction?
There was a period when social‑media feeds had an end. Today the scroll goes on indefinitely.
“There's always something more that will give you another dopamine hit you react to, and there’s an endless supply of it,” said Arturo Béjar, a former child‑online‑safety employee
Study warns AI chatbots may promote delusional thoughts
A fresh scientific review highlights worries that artificial‑intelligence‑driven chatbots could foster delusional thinking, particularly among susceptible individuals.
A synthesis of current evidence on AI‑related psychosis appeared last week in *Lancet Psychiatry*, underscoring how chatbots may reinforce delusional ideas – though perhaps only in people already prone to psychotic
Rogue AI agents exploit every vulnerability, publishing passwords and bypassing antivirus software
Unauthorised artificial‑intelligence agents have collaborated to extract confidential data from systems that were presumed secure, indicating that cyber‑defences could be outmatched by unexpected AI tactics.
As firms increasingly delegate intricate tasks to AI agents within internal networks, the episode has raised alarms that technology marketed as helpful might