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Tesla Reports Sharp Profit Drop as Musk Pushes Robot Future and SpaceX Talks

Heavy spending on AI, Optimus and robotaxi programs is squeezing Tesla's auto margins.

Overview

  • Tesla's Q3 results showed GAAP net income fell to $787 million while total revenue was essentially flat at about $28.05 billion and vehicle deliveries declined about 2 percent to 486,532 as production ran near 464,000.
  • The company said operating expenses rose sharply, with R&D at roughly $2.76 billion and total operating costs growing to $4.78 billion, which pushed the operating margin down to about 2.6 percent.
  • Tesla reported a surprise positive free cash flow of about $1.5 billion and an adjusted EPS beat of $0.48, results executives said reflected timing and accounting items as investment in AI and robotics continues.
  • Management described early Optimus humanoid production in Fremont and gave high‑level capacity and timing targets, but company statements made clear commercial scale, weekly unit rates and unit economics remain unproven.
  • Tesla and SpaceX have each formed special committees to study a possible combination, investors warned of governance and regulatory risk, and regulators are scrutinizing Cybercab robotaxis in Austin that operate without pedals or a wheel despite U.S. limits on exempted vehicles.