Tesla (TSLA) Q3 2024 earnings report

Tesla reported third-quarter earnings Wednesday that topped analysts’ estimates even as revenue came in just shy of expectations. The stock popped 12% in extended trading.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

• Earnings per share: 72 cents, adjusted vs. 58 cents expected
• Revenue: $25.18 billion vs. $25.37 billion expected

Revenue increased 8% in the quarter from $23.35 billion a year earlier. Net income rose to about $2.17 billion, or 62 cents a share, from $1.85 billion, or 53 cents a share, a year ago.

Profit margins were bolstered by $739 million in automotive regulatory credit revenue during the quarter. Automakers are required to obtain a certain amount of regulatory credits each year. If they can’t meet the target, they can purchase credits from companies such as Tesla, which has excess credits because it makes only electric vehicles.

Automotive revenue increased 2% to $20 billion from $19.63 billion in the same period a year earlier and is about flat since late 2022. Energy generation and storage revenue soared 52% to $2.38 billion, while services and other revenue, which includes revenue from non-warranty repairs of Tesla vehicles, jumped 29% to $2.79 billion.

CEO Elon Musk said on the earnings call that his “best guess” is that “vehicle growth” will reach 20% to 30% next year, due to “lower cost vehicles” and the “advent of autonomy.” Analysts surveyed by FactSet were expecting a total increase in deliveries next year of about 15% to 2.04 million.

Asked on the call if Tesla would make a lower cost EV that’s not a Cybercab, Musk said all of the company’s cars moving forward would be autonomous. He said that, of the 7 million vehicles Tesla has produced to date, the “vast majority” are “capable of autonomy,” adding that the company is “currently making on the order of 35,000 autonomous vehicles a week.” Tesla still doesn’t produce or sell cars that are safe to use without a human at the wheel, ready to steer or brake at all times.

Musk said the company would be producing  2 million Cybercabs a year eventually, and offering driverless ride-hailing in its cars as early as 2025 in Texas and likely California. He said Tesla has developed a ride-hailing app that some employees in California have been able to use this year.

“You can request a ride and it’ll take you anywhere in the Bay Area,” Musk said. “We do have a safety driver for now.”

Tesla isn’t currently licensed to operate a commercial, transportation network company or ride-hailing service in California, according to a list of permits issued on the California Public Utilities Commission’s website.

In a shareholder deck, Tesla said the Cybertruck, became the third-best-selling fully electric vehicle in the U.S., behind only the Model 3 and Model…