Tesla soars $80bn on record profits and bold 2025 forecasts

Tesla's market value surged by $80 billion after posting its largest quarterly profit in over a year, buoyed by strong Cybertruck sales and regulatory credits. CEO Elon Musk shared optimistic forecasts, promising 20-30% delivery growth in 2025, while hinting at ridesharing launches in Texas and California. Despite skepticism over missed timelines, Tesla's stock jumped 12%, boosted by the success of its energy business and a strong outlook for its autonomous Cybercab production..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here..By Kara Carlson and Dana Hull .___STEADY_PAYWALL___.Tesla Inc.'s market value soared by $80 billion after the EV maker reported its biggest quarterly profit in more than a year and issued upbeat forecasts for 2025..Third-quarter results were buoyed by sales of the Cybertruck, which turned a profit for the first time, its energy-storage business and a spike in regulatory tax credits that other automakers pay to meet emissions rules. But the stock was also bid up by hopes for the future: An ebullient Elon Musk spent a long portion of Wednesday's earnings call on a monologue that promised to make Tesla the most valuable company in the world, starting with 20% to 30% delivery growth next year..Musk, who is known for missing overly optimistic timelines, said Tesla aims to officially roll out ridesharing in Texas and California next year. Although driving on public roads would require regulatory approval, Musk's comments sent shares in competitors Uber Technologies Inc. and Lyft Inc. lower..A Tesla logo on a tire rim at a charging station in San Francisco, California, US, on Thursday, Oct. 17, 2024. Tesla Inc. is scheduled to release earnings figures on October 24. Photographer: David Paul Morris/Bloomberg.Musk also said that production of the dedicated robotaxi, which he calls the Cybercab, will reach volume production in 2026 and that the company is aiming for at least 2 million units — and "maybe 4 million ultimately."."Investors who wanted something today got better-than-expected profit and guidance for growth in deliveries," said Gene Munster, managing partner of Deepwater Asset Management. "The long-term investors got the golden carrot.".Read more: Tesla's Robotaxi launch: Stock plummets after vague Cybercab reveal.Musk also said Tesla was on track to roll out affordable models next year, but he disabused a long-held expectation by some investors that the company would roll out an electric vehicle to compete with mass-market autos such as the Toyota Corolla. Instead, Musk said the EV maker was focusing on its autonomous Cybercab, which he said would start out around $30,000. A regular $25,000 EV would be "pointless," Musk said, noting that all Tesla cars being produced will have autonomous capabilities..The billionaire also used the earnings call for his only publicly traded company to tout what he would do with a potential job in a Trump administration should the former president go back to the White House. While Musk didn't mention Trump by name, he cited a "department of government efficiency" role that the Republican presidential candidate began floating for the Tesla CEO after Musk directed more than $75 million to his campaign. If appointed, Musk said he would create a pathway for federal approval of autonomous vehicles instead of the patchwork of state regulations that exist now..Tesla shares soared 12% in postmarket trading in New York, potentially erasing much of the 14% decline the stock has posted so far this year through Wednesday's close. .'Slight Growth'.The automaker projected "slight growth" in vehicle deliveries for the full year. That will require a record-breaking fourth quarter to overcome the slump Tesla saw in the first half of the year..Tesla said the Cybertruck, which it first delivered late last year, has been boosted by increases in production. The company has not said how many trucks it has sold, but recalls show the company has delivered at least 27,000 in the US..Read more: Tesla unveils $30k Cybercab Robotaxi, targets 2026 production.Seth Goldstein, an analyst with Morningstar, said Tesla is benefitting from higher volumes and more stable prices. "Prices are stabilizing and unit costs are coming down," he said in an interview. .For the third quarter, Tesla reported adjusted earnings of 72 cents per share, beating the average analyst estimate and snapping four consecutive quarters in which the measure missed expectations. The company's third-quarter automotive gross margin, excluding regulatory credits, was 17.1%, beating analysts' estimates and up from the previous quarter, when it was 14.6%..Low Expectations.Tesla's strong earnings report came less than two weeks after a glitzy event dedicated to the company's new robotaxi, which disappointed many investors..Garrett Nelson, an analyst with CFRA Research, said investors had a low bar for this quarter and questioned whether Tesla can sustain the level of profitability.."Expectations were low heading into the release after four consecutive bottom-line misses and a Robotaxi Day that left investors with more questions than answers" Nelson said in a research note to clients..Tesla said the increased profitability was due to higher delivery volumes as well as booming sales of regulatory credits to other carmakers needing help to meet their emissions requirements. Revenue from regulatory credits came to $739 million in the three months ended Sept. 30 — a record for the period but below the $890 million it earned in the second quarter..Read more: 🔒 Elon Musk's Tesla robotaxi needs to come with a time machine: Liam Denning.The company also credited its energy business as a revenue driver. Tesla has already deployed more storage products so far this year than in all of 2023, including 6.9 gigawatt hours of storage this quarter..The company is also expanding its charging network after the high-profile layoff of much of its supercharging team earlier this year. The company added 2,800 new stalls in the third quarter, a 22% increase from the previous year. .Robotaxi.On robotaxi, Tesla's vehicle without controls such as pedals or a steering wheel, the company said it will use a new unboxed manufacturing technique, which differs from a traditional production line by assembling parts simultaneously in dedicated areas before putting everything together at the end. .Musk said he expects autonomous versions of his other vehicles as well: "There's no need to wait for robotaxi or Cybercab to experience full autonomy. We expect to achieve that with our existing vehicle lineup." .He even dropped a hint about air taxis when asked about the slow development of a promised Roadster model. The CEO said Tesla remains focused on mass-market vehicles first as part of its sustainability goals, but indicated his company is "close to finalizing the design" on that vehicle. He added that Peter Thiel — Musk's billionaire friend and venture capitalist — lamented about a lack of flying cars, to which Musk mused "we'll see.".Read also:.🔒 Tesla desperately needs Musk's robotaxis to live up to the hype: Liam DenningTesla's South Africa launch delayed, refund issues persistTesla's stock plunges 12% after profit miss and robotaxi delay.© 2024 Bloomberg L.P.

Tesla soars $80bn on record profits and bold 2025 forecasts

Related Stories

Breakthroughs for batteries could soon make them much better

Webinar: Accretiv doubles down on US industrial property

Trump’s 3,700+ trades stun Wall Street insiders

BN portfolios: Berkshire builds $2.6bn Delta Airlines position amid sector reset