Tesla reported a quarterly revenue record overnight, but earnings still managed to miss analyst forecasts and fall from a year ago.
The company earned adjusted income of $US1.8 billion ($2.77 billion) in the third quarter, down 29 per cent from a year ago. Despite the earnings miss, it was still the company’s best quarter so far this year.
The drop in earnings came even after Tesla reported record sales of nearly 500,000 cars during the quarter, as Americans rushed to buy electric cars before a $US7500 ($11,558) federal tax credit expired on October 1.
Teslas stationed in a storage area in the Zeebrugge port, northern Belgium. (John Thys/AFP/Getty Images via CNN)
But electric vehicle sales in the US are widely expected to plunge in the fourth quarter.
That’s because people who would have normally bought EVs later in the year flocked to buy cars early to lock in the tax break.
The loss of the tax credit is expected to hurt demand among American buyers going forward.
Tesla gets nearly half of its revenue from US customers.
Tesla is also facing increased competition for EV sales globally, particularly from Chinese automakers.
Tesla CEO Elon Musk. (AP)
Those automakers not only dominate their own domestic market, but are also moving into Europe.
Chinese automaker BYD is poised to overtake Tesla as the world’s largest seller of EVs this year, despite the fact that it does not sell any cars in the US.
Tesla sales worldwide fell 13 per cent during the first six months of 2025 compared to a year earlier both due to increased competition, as well as backlash to Tesla chief executive Elon Musk’s political activity.
