Tesla reports steep drop in profits despite US rush to buy electric vehicles
Despite record vehicle sales, Tesla saw a precipitous drop in profit in its most recent quarter.A rush to buy electric vehicles before a US tax credit for them disappears had boosted Tesla’s flagging sales, leading to the automaker exceeding some of Wall Street’s projections in its most recent financial quarter.Yet the company failed to meet earnings expectations and its stock fell in after-hours trading.Tesla reported third-quarter earnings of $0.50 a share on Wednesday after market close, less than the $0.
54 that market analysts predicted.The automaker exceeded Wall Street’s expectations of $26.457bn in revenue.Its operating income was $1.62bn against expectations of $1.
65bn,It also reported a net income of $1,4bn, down from $2,2bn, a drop of 37% in its profits,Tesla’s deliveries in the third quarter surged from earlier in the year, an increase that analysts attributed to consumers attempting to lock in electric vehicle tax credits that expired at the end of last month.
The loss of EV credits as a result of Donald Trump’s One Big Beautiful Bill Act was a factor in the public breakup between Musk and the president and has continued to influence the company’s sales forecasts.The company made numerous optimistic mentions of its AI software and commitment to expand its autonomous driving technology in a press release on the results, while also citing “shifting trade, tariff and fiscal policy” as challenges it is navigating.“No one can do what we can do with real-world AI,” Musk claimed during an investor call.He also claimed that Tesla’s Optimus robots, which received only a fleeting mention in the earnings report, had the potential to become “the biggest product of all time”.“We believe, with Optimus and self-driving, that you can actually create a world with no poverty,” Musk added.
He also referenced his proposed $1tn pay package, which he claimed would give him a defense against being “ousted” once Tesla built a “robot army”.The earnings report comes at a sensitive time for Tesla and Musk, as the CEO is seeking investor approval for that unprecedented $1tn pay package in a vote next month.The package is dependent on Tesla reaching several lofty milestones, including achieving an $8.5tn market cap over the next 10 years.Despite the world’s richest person still commanding a legion of Tesla fanboys and investors eager to appease him, two proxy advisory firms have so far recommended against approving the exorbitant pay package.
Glass Lewis and Institutional Shareholder Services (ISS), who provide guidance on how shareholders should vote, stated in recent days that they advised voting no on the proposed trillion-dollar compensation plan.On Wednesday’s call with investors, Musk made several claims about the future of Tesla’s robotaxi ride-share service.He told investors that the robotaxi product, which involves a safety driver riding in the autonomous car in case of emergency, would soon remove drivers from cars in the Austin rollout of the service.The US’s main transportation safety regulator announced in recent weeks that it is investigating reports of traffic safety violations and crashes involving Tesla’s Full Self Driving technology.Musk has also insulted Sean Duffy, the US transportation secretary, this week in a series of posts that included calling him “Sean Dummy” and reposting calls for him to be removed from his post.
Duffy, who is also acting head of Nasa, stated on Monday that he would reopen the bidding for contracts related to the space agency’s Artemis moon mission because Musk’s SpaceX rocket company had fallen behind on its timelines for the project.Sign up to TechScapeA weekly dive in to how technology is shaping our livesafter newsletter promotionShareholders are set to vote on Musk’s $1tn pay package during an annual company meeting on 6 November.Both Tesla and Musk have lashed out at criticism of the package, with the company calling the ISS recommendation against the proposal an “unfounded and nonsensical recommendation” in a lengthy post on X.Musk additionally implied in a post on X that he could leave the company if not granted the pay package, and on the call with investors accused ISS and Glass Lewis of “corporate terrorism”.Tesla had a tumultuous year that saw heightened competition, a loss of key tax credits and chaotic leadership from Musk himself.
The company reported falling profits and revenue last quarter.Musk’s political activities, including taking a lead role in the Trump administration and promoting far-right causes, also led to widespread backlash and anti-Tesla sentiment as stock prices fell at the start of the year.Tesla’s shares have rallied vigorously over the past six months, however, while Musk has heavily promoted autonomous taxis and robotics as a source of future revenue.The CEO claimed last month that Tesla’s Optimus robot, a humanoid machine that has yet to go into mass production and is not available for purchase, will one day account for 80% of the company’s revenue.He has made similarly grandiose statements about millions of robotaxis filling cities around the world, something he has promised for years while continually pushing back the timeline of when it would become a reality.
Tesla also debuted a long-promised, cheaper sedan called the Model Y earlier this month in a bid to increase slumping sales,The new line of sedans received criticism from some analysts over its starting prices of $39,990 and $36,990 – significantly higher than Chinese low-cost competitors,Tesla’s stock price immediately fell following the rollout,The company’s other new model, the Cybertruck, released in 2024, has failed to make a meaningful contribution to overall sales,
Oil price jumps and FTSE 100 hits new high after Trump puts sanctions on Russian firms
Oil prices jumped and energy companies helped the FTSE 100 to a record high after Donald Trump announced new sanctions on Russia’s two biggest oil producers.Brent crude increased by 5.7% to $66.13 a barrel after the news of the fresh restrictions on Rosneft and Lukoil, as the US president ramps up pressure on Vladimir Putin to end the war in Ukraine.The jump in oil price also boosted shares in the energy companies Shell and BP by about 3%, which in turn helped to drive the FTSE 100 to a record high of 9,594
Dining out ‘under pressure’ as Britons cut back due to price rises, says YouGov
More than half of British diners say rising prices are the main reason they are eating out less, according to YouGov data showing that overall 38% of people are visiting restaurants and other eateries less often than a year ago.Among those cutting back, 63% cite higher costs as the main reason to dine out less frequently, according to the poll. Despite this downturn, more than two in five are still choosing to eat out at least once a month, while 8% of people say they never do.UK inflation was unchanged last month at 3.8%, confounding expectations of a rise, in welcome news for the chancellor, Rachel Reeves, as she plans her crucial budget next month
Foxtons shares drop sharply after it warns of ‘subdued’ pre-budget sales
The estate agency Foxtons has warned of weak sales for the rest of the year as economic uncertainty and potential property tax changes in next month’s budget deter buyers, sending its shares sharply lower.The London-focused company, known for its green-and-yellow Mini cars, said buyers had been holding off ahead of the budget on 26 November, which is a month later than usual.Slower-than-expected interest rate cuts from the Bank of England are also having an impact by affecting the cost of mortgages, it said. As a result, “sales are likely to remain subdued for the rest of the year”, with a risk that revenues in the fourth quarter could fall below management’s expectations.Guy Gittins, the chief executive who started his career at Foxtons in 2002 and returned to lead the company three years ago, said: “Macroeconomic uncertainty and speculation surrounding the delayed autumn budget has resulted in a subdued sales market as some buyers adopt a ‘wait and see’ attitude to purchases
Aerospace groups link up to create European rival to Musk’s SpaceX
Airbus, Leonardo and Thales have struck a deal to combine their space businesses to create a single European technology company that could rival Elon Musk’s SpaceX.The deal is expected to create a company with annual revenue of about €6.5bn (£5.6bn). The French aerospace company Airbus will own 35% of the new business, with Leonardo and Thales each owning stakes of 32
Lloyds profits plunge 36% as it feels impact of UK car finance scandal
Lloyds Banking Group profits have been sent plunging by more than a third by the car loans commission scandal, as the lender steels itself for a surge in compensation payouts to drivers.The high street bank took the 36% hit in the third quarter after putting aside a further £800m to cover the prospective costs of a redress scheme proposed by the Financial Conduct Authority (FCA).The additional charge, announced last week, brings Lloyds’ total compensation pot to £1.95bn.Lloyds is the UK’s biggest car lender through its Black Horse division and is expected to foot the largest bill among its peers
Thames Water ranked worst supplier in England as firms’ ratings hit record low
England’s water company ratings have fallen to the lowest level on record after sewage pollution last year hit a new peak, with eight of nine water companies rated as poor and needing improvement by the Environment Agency.The cumulative score of only 19 stars out of a possible 36 is the lowest since the regulator began auditing the companies using the star rating system in 2011.Only one company, Severn Trent, achieved full marks. It did so despite having been responsible for 62,085 sewage spills, averaging seven hours each, in 2024.Struggling Thames Water was the only company to be awarded one star for its performance
Repair bills could force hundreds of UK churches to close within five years
London museum identifies black Waterloo veteran in rare 1821 painting
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‘London could 100% compete with Cannes’: Aids charity UK gala debut honours Tracey Emin
Champagne, celebs and artefacts: British Museum hosts first lavish ‘pink ball’ fundraiser