Tesla Q3 earnings fall short of expectations

Tesla reported adjusted earnings of $0.66 per share, versus estimates of $0.73, and said total operating margins had sunk from 17.2% a year ago to just 7.6%. Revenues came to $23.35bn, short of the $24.1bn predicted by analysts.

During the quarter, the company reported $19.63bn in automotive revenue and $1.56bn in revenue from its energy generation and storage business. Within automotive revenue, regulatory credits revenue rose to $554.0m, up from $282,0m in Q2.

Net income for the quarter was $1.85bn down from $3.29bn, while total gross profit declined 22% year-on-year.

Musk also revealed that the Cybertruck will fail to deliver any significant positive cash flow for at least 12-18 months following the beginning of production and also emphasized that Tesla was now dialled in on making more affordable vehicles in the current high-interest rate environment.

On the economy, Musk said: "I'm worried about the high interest rate environment we're in" and said customers were now focused on maintaining monthly payments.

"If interest rates remain high or if they go even higher, it's that much harder for people to buy the car," he added.

"I just can't emphasize enough how important cost is," he noted. "We have to make our products more affordable so people can buy it."

As of 1605 BST, Tesla shares were down 7.86% at $223.61 each.

Reporting by Iain Gilbert at Sharecast.com