Tesla's price cuts eat into Cybertruck maker's profits as net income plunges 44% in the 3rd quarter
Tesla has reported that its net income slumped in the third quarter versus a year earlier
LOS ANGELES — Tesla's net income slumped in the third quarter versus a year earlier, as price reductions helped drive strong sales growth but also ate into the automaker’s profit margins
The Austin, Texas, maker of electric vehicles, solar panels and batteries on Wednesday reported net income of $1.85 billion for the July-September quarter, a 44% decline from a year earlier. Earnings per share fell to 53 cents from 95 cents.
Excluding stock-based compensation, Tesla’s adjusted net income fell to $2.32 billion, or 66 cents per share. On that basis, Tesla’s earnings fell short of analysts’ consensus estimate of 73 cents per share, according to FactSet.
Total revenue rose 9% to $23.35 billion. Analysts had forecast $24.19 billion.
Earlier this month, the company reported that it sold 435,059 vehicles during the July-September period, an increase of 27% from the same stretch last year. Even so, Tesla’s deliveries came in below the 461,000 vehicles analysts had predicted the company would sell during the quarter, according to FactSet Research.
The third-quarter sales also marked a step back from Tesla’s 466,140 vehicle deliveries during the April-to-June period, something Tesla blamed on planned downtime to upgrade its factories.
Tesla has been slashing prices most of this year to keep attracting buyers who now have a wider selection of electric vehicles as more automakers shift away from gasoline-powered cars and trucks. The discounts range from $4,400 on Tesla’s top-selling vehicles to as much as $20,000 on its most expensive models.
The latest round of cost cutting trimmed Tesla’s operating margin, which represents how efficiently
Read more on abcnews.go.com
