Elon Musk’s Tesla has posted significant third-quarter earnings growth, marking a turnaround from earlier struggles this year, while announcing major strategic shifts in its future vehicle lineup and autonomous driving initiatives.
The Wall Street Journal reports that Elon Musk’s car company reported a net income of $2.2 billion for the third quarter, representing a 17 percent increase compared to the same period last year. This financial performance was primarily driven by increased sales of regulatory credits to other automakers and robust performance in Tesla’s energy division.
The company’s revenue climbed eight percent to $25.2 billion, supported by rising global deliveries during the third quarter. Tesla’s stock responded positively to the earnings announcement, surging 12 percent in after-hours trading on Wednesday.
In a significant strategic pivot, CEO Elon Musk revealed that Tesla has abandoned its previously announced plans for a $25,000 electric vehicle. Instead, the company will introduce lower-cost versions of existing models, priced below $30,000 after subsidies, scheduled for release in the first half of 2025. Following these releases, Tesla plans to focus on developing a dedicated robotaxi without traditional vehicle controls such as a steering wheel or pedals.
The company’s financial results were bolstered by several key factors. Tesla achieved its second-highest quarterly revenue from regulatory credit sales, which represent pure profit for the company. Additionally, the energy business division posted a record gross margin of 30.5 percent in the third quarter, helping to offset reduced selling prices across various vehicle models. The company’s operating margin improved to 10.8 percent, up from 7.6 percent in the previous year.
Notable progress was reported with the Cybertruck, which achieved a positive gross margin for the first time since its November launch. Looking ahead, Tesla has committed to capital expenditures exceeding $10 billion this year, primarily focused on data center expansion and software improvements crucial to its autonomous driving aspirations.
During a recent event at Warner Bros. Studios, Tesla unveiled two new autonomous vehicle concepts: the Cybercab, a gold-colored two-seater featuring butterfly-wing doors, and the Robovan, a 20-seat vehicle with Art Deco styling. The Cybercab is projected to be available to customers for under $30,000, with production targeted for 2027.
Tesla’s immediate plans include the release of an enhanced version of its Full Self-Driving technology next year, initially deployed on a test fleet before wider customer availability. The company also intends to launch its paid ride-hailing application in the coming year.
While Tesla’s global sales showed improvement in the third quarter, particularly in China, and benefited from new financing options, the company’s year-to-date global deliveries remain below last year’s figures. This creates pressure for an exceptionally strong fourth quarter to surpass 2023’s performance.
Looking forward, Musk projected potential vehicle growth of 20 percent to 30 percent in 2025, which would mark a significant improvement from current performance, as global deliveries have decreased by nearly six percent in the first three quarters of 2024.
Read more at the Wall Street Journal here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.