Shares of Tesla (TSLA) are up 10% after the electric vehicle maker reported strong financial results for the year’s third quarter.
Tesla announced earnings per share (EPS) of $0.72 U.S., which handily beat the $0.58 U.S. expected on Wall Street.
Revenue for the quarter came in at $25.18 billion U.S., which fell a little short of consensus forecasts of $25.37 billion U.S. However, sales were up 8% from a year earlier.
The stock of Tesla is also rising following bullish guidance provided by the company’s chief executive officer (CEO) Elon Musk.
On an earnings call with analysts and media, Musk confidently forecast that “vehicle growth” at Tesla will reach 20% to 30% next year due to “lower cost vehicles.”
According to FactSet, analysts had been expecting an increase in deliveries next year of about 15%.
Breaking down Tesla’s financial results, the company’s profit margins got a boost from $739 million U.S. in automotive regulatory credits.
Automakers are required to obtain a certain number of regulatory credits each year. If they can’t meet the target on their own, they can purchase credits from companies such as Tesla that make only electric vehicles.
Tesla’s automotive revenue increased 2% to $20 billion in this year’s third quarter and is flat since 2022.
However, energy generation and storage revenue soared 52% to $2.38 billion U.S. in Q3, while services and other revenue, which includes non-warranty repairs to vehicles, rose 29% year-over-year to $2.79 billion U.S.
Earlier in October, Tesla reported Q3 vehicle deliveries of 462,890. While deliveries increased 6% from a year earlier, they fell short of analysts’ expectations and followed two consecutive quarters of year-over-year declines.
Prior to today (Oct. 24), Tesla’s stock had declined 14% this year and was trading at $213.65 U.S. per share.
