Tesla’s (TSLA) stock is down 5% after the electric vehicle maker missed Wall Street’s expectations for its third-quarter earnings.
The company led by Elon Musk announced earnings per share (EPS) of $0.66 U.S. and revenue of $23.4 billion U.S.
Analysts who cover the automotive company had been looking for a profit of $0.70 U.S. a share and sales of $23.9 billion U.S. for the July through September quarter.
The company’s EPS was down 37% from the same quarter of 2022.
Additionally, Tesla reported that its gross profit margin was 16.3% in Q3 of this year. That was below the 17.5% expected on Wall Street.
Operating profit margins for Q3 came in at 7.6%, down nearly 10 percentage points from a year ago.
On an earnings call, Tesla executives indicated that the price cuts the company has made throughout this year are likely to continue as it tries to boost sales going forward.
“Tesla is an incredibly capable ship,” said Musk during the call with analysts and media. “But even a great ship in a storm has challenges.”
Tesla has cut prices aggressively this year to help drive sales volumes amid rising interest rates, a slowing global economy, and increasing competition from other automakers.
The average price of a Tesla electric vehicle is now $10,000 U.S. lower than it was a year ago, said the company.
Musk said that Tesla still expects to ship 1.8 million electric vehicles this year, which implies at least 475,000 units sold in the current fourth quarter.
However, Musk tempered expectations for the upcoming release of Tesla’s Cybertruck, saying that while some deliveries are expected in 2023, it will likely take 18 months before the electric pick-up truck is a significant profit contributor to the company.
Before today (Oct. 19), Tesla’s stock had risen 9% over the past 12 months to trade at $242.68 U.S. per share.
