Tesla Q3 profit falls 44 per cent despite vehicle sales rise

Summarised from 2 outlets · Updated 22 Oct, 00:32 · Archive

Tesla reported third-quarter net income of $US787 million, down 44 per cent year-on-year, though it sold nearly 490,000 vehicles and generated $US1.5 billion in free cash flow.

Tesla reported third-quarter net income of $US787 million, down 44 per cent from the same period last year. Excluding certain items, earnings per share of 48 cents beat Wall Street analyst expectations by three cents. Revenue was basically flat at $US28 billion, falling slightly short of forecasts.

The company sold nearly 490,000 vehicles in the quarter, a rise from the prior three months, following a prolonged sales decline that stretched more than a year. Profit margins held up despite concerns that discounts to boost sales may have squeezed profitability. Tesla reported making 18.1 cents for every dollar of car sales, up almost three cents from a year earlier.

A positive was free cash flow of $US1.5 billion—cash available after investments needed to keep the business running—a surprise to analysts who had expected the company to be burning through cash. However, capital spending doubled to $US4.7 billion in the quarter, a major concern for tech investors questioning future returns from artificial intelligence investments.

Elon Musk said in a SpaceX conference call that special committees have been set up at each company to discuss a possible merger between Tesla and SpaceX, though he cautioned that many hurdles remain.

How it is being reported

• Tesla's Q3 profit drops 44 per cent from year earlierElectric car manufacturer Tesla has reported third quarter net income of $US787 million.The West Australian · 22 Oct, 00:13
• Tesla's Q3 profit drops 44 per cent from year earlierElectric car manufacturer Tesla has reported third quarter net income of $US787 million.Perth Now · 22 Oct, 00:13

In this story: Tesla · SpaceX · Elon Musk · Wall Street

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