• Tesla Forecasts 30% vehicle growth next year
• Efficiency measures boost profitability, as Net income beats estimates

CEO Elon Musk said that vehicle growth” will reach 20% to 30% next year, due to “lower cost vehicles” and the “advent of autonomy.”

Shares jumped close to 22% on Thursday – their biggest single-day gain in the last 10 years.

Revenue popped 8% in the quarter from $23.35 billion a year earlier.

Source: Company Reports

Automotive revenue rose to $20 billion, up from $19.63 billion in the same period last year, remaining relatively flat since late 2022.

Energy generation and storage revenue surged 52% to reach $2.38 billion.

Services and other revenue, which includes income from non-warranty repairs of Tesla vehicles, grew by 29% to $2.79 billion.

Tesla reported that the labor and material costs for producing vehicles dropped to a record low of about $35k.

Raw material prices for EV batteries are falling, and Tesla expects its costs to decrease this year, though the impact may lessen over time.

Net income increased to around $2.17 billion, or 62 cents per share.

Source: Company Reports

Profit margins received a significant boost from $739 million in automotive regulatory credit revenue during the quarter.

Automakers must acquire a specific number of regulatory credits each year, and those unable to meet their targets can purchase credits from companies like Tesla, which has a surplus due to its exclusive focus on electric vehicles.

Looking ahead, Elon Musk shared that Tesla is gearing up to produce 2 million Cybercabs each year and has ambitious plans to introduce driverless ride-hailing services as soon as 2025.

To stimulate demand, Tesla has rolled out attractive financing options following last year’s price cuts.

In a recent announcement, the company revealed that the Cybertruck has now secured its position as the third-best-selling electric vehicle in the U.S., right behind the Model 3 and Model Y.

Although Tesla usually doesn’t break down sales by model, they noted with excitement that the Cybertruck has finally achieved a positive gross margin.

Still, the road ahead isn’t without challenges. Tesla is facing intensified competition, especially in China, where companies like BYD and Geely are gaining traction. Meanwhile, in the U.S., legacy automakers such as Ford and General Motors are stepping up their game by expanding their electric vehicle lineups.

This earnings report comes on the heels of a much-anticipated robotaxi event, which, while generating buzz, left many shareholders eager for more insights and details about Tesla’s future plans.

Additionally, it coincides with the upcoming U.S. presidential election, during which CEO Elon Musk has been actively campaigning for former President Donald Trump, raising questions about how his political activities may impact Tesla.

For the year, the shares are up 5%, while the Nasdaq is up 25% over that period.

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