Investor's Corner
Tesla’s Q3 2018 earnings call: What we expect to see
In a rather surprising announcement on Monday, Tesla revealed that it was releasing its Q3 2018 earnings report after the closing bell on Wednesday. The earlier-than-expected earnings call appears to have fostered positive sentiments among the company’s investors, and coupled with a change of heart from a staunch TSLA short-seller, Tesla stock (NASDAQ:TSLA) saw a 12.72% rise on Tuesday, bringing the company within reach of the $300-per-share-mark once more.
While Tesla was able to hit its production and delivery targets in Q3, questions remain about whether the company was able to turn a profit as promised by CEO Elon Musk. That said, Wall Street analysts polled by FactSet expect Tesla to post revenue of $6.05 billion and a GAAP EPS of -$0.95, partly due to a major increase in Model 3 deliveries in the third quarter. Non-GAAP EPS consensus is a more favorable -$0.03.
With these in mind, here are some pertinent updates and information we are expecting to see in Tesla’s Q3 2018 earnings call.
Profitability and Cash-Flow Updates
Earlier this year, Elon Musk boldly declared that Tesla would be profitable and cash-flow positive in the second half of the year. The company went through great lengths in its efforts to achieve this ambitious target, from laying off 9% of its employees last June to allowing owners to help out the company deliver as many vehicles as possible in the final weeks of the third quarter.
Wall Street analysts polled by FactSet expect the company to report a modest amount of positive free cash flow for the third and fourth quarter. Non-GAAP EPS is also expected to improve to $0.78 in Q4. In the upcoming earnings call, Tesla would likely offer some updates on its profit outlook in its shareholder letter.
Model 3 Production and Margins
In Tesla’s Q2 shareholder letter, the company stated that it is aiming to grow Model 3 production to 10,000 units per week as soon as it can. Tesla also aimed to produce the Model 3 at a rate of 6,000 per week by late August — a goal that the company was unable to attain. In today’s earnings call, Tesla is expected to provide an updated guidance for the Model 3 ramp.
Back in August, Tesla noted that it expects Model 3 gross margins (GM) to improve to 15% and 20% in Q4. These figures are a bit more conservative than Tesla’s initial forecasts for the vehicle, which estimated gross margins to be at 25% when production is stabilized at 5,000 units per week. The upcoming earnings call should provide some guidance as to where the Model 3’s gross margins are at this point, and where it could be at the end of Q4.
The $35,000 base Model 3 and the Model Y
Tesla has pretty much hit its stride with the production of the Long Range RWD, Dual Motor AWD, and Dual Motor Performance Model 3. Earlier this month, the company also revealed the Mid Range RWD Model 3, a vehicle that places the electric car’s price closer to Elon Musk’s $35,000 starting price for the electric sedan. Considering that the company has left its self-imposed production hell, the time might be right for Tesla to provide some updated guidance as to when the long-promised $35,000 Model 3 would enter production.
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Updates on other upcoming vehicles are also expected, particularly the next car in the company’s lineup — the Model Y. Considering that Elon Musk has teased an unveiling sometime early next year for the crossover SUV, there is a good chance that the upcoming Q3 2018 earnings call would provide a more concrete date for the highly-anticipated vehicle’s unveiling.
Tesla Energy Updates
Tesla Energy does not attract as many headlines as the company’s electric car business. Despite this, the company’s executives including CEO Elon Musk and CTO JB Straubel have both noted that Tesla’s energy storage business would likely match the company’s electric car division in the near future. This was highlighted recently by legendary investor Ron Baron, who stated that Tesla could become a $1 trillion company by 2030, comprised of a $500 billion electric car division and a $500 billion battery storage business.
Wall Street analysts’ consensus for Tesla Energy estimates the business to post revenue of $377 million (up 19%), and a gross profit of just $20 million. Announcements on upcoming battery storage projects are also expected to be discussed in the upcoming call.
Tesla’s New Chairman
As part of his settlement with the Securities and Exchange Commission, Elon Musk agreed to step down as Tesla’s Chairman. Reports eventually emerged that board member James Murdoch was in line to take on Musk’s role. These reports were eventually debunked by Elon Musk himself on Twitter, though, leaving Tesla’s next chairman still a large question mark.
On Wednesday’s earnings call, expectations are high that the company would provide some updates on its search for a new Chairman to replace Elon Musk. Other terms of the CEO’s settlement with the SEC, particularly the addition of two new independent board members, would likely be discussed as well.
Tesla’s Q3 Update letter would be posted on Tesla’s Investor Relations website after markets close today. At 3:30 pm Pacific Time (6:30 pm Eastern Time), Tesla would start its Q3 earnings call.
Elon Musk
The real reason Elon Musk wants every car connected to space
Elon Musk says all cars will eventually need Starlink to handle massive AI bandwidth demand.
Elon Musk is making the case that satellite internet, not fiber or cellular towers, will end up wired into every car on the road. In a string of posts on X, the SpaceX CEO wrote that all cars will have Starlink in the future and called satellite connectivity the only way to get super high bandwidth to billions of vehicles.
The posts started with Musk endorsing a Cloudflare forecast that traffic generated by autonomous AI agents will soon dwarf traffic generated by humans browsing the internet, a shift he described as not a close call at all. From there he narrowed the argument to infrastructure, writing that the only system that can support the insanely fast bandwidth growth needed by AI is Starlink, before extending the logic to cars specifically.
AI agentic Internet traffic will obviously VASTLY exceed human usage. Not a close call at all.
Cloudflare’s forecast is accurate. https://t.co/VztgrinN5k pic.twitter.com/Wo4FiRKjPU
— Elon Musk (@elonmusk) August 9, 2026
The timing lines up with Tesla’s own hardware decisions. On July 20, Tesla confirmed the Cybercab would ship with a Starlink V5 terminal built into its roof, the first time the company had put satellite hardware in a production vehicle. A day later, Tesla’s head of AI, Ashok Elluswamy, explained the connection wasn’t there for safety and that Cybercab’s driving stack runs entirely on onboard cameras and compute, while the satellite link exists for navigation, customer service, and fleet management instead. Musk followed with his own post about the feature, saying riders would be able to watch 4K streaming video during rides.
By July 22, Musk had already said Starlink would extend beyond Cybercab to Tesla’s full lineup. Sunday’s posts push that same logic outward again, this time framed as a requirement across the industry rather than a feature specific to Tesla, and tied directly to the bandwidth AI systems are expected to consume.
SpaceX’s newest Starmind will make earth data centers obsolete
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The AI argument has been building on SpaceX’s side for months. The company has an FCC filing pending for a third generation Starlink constellation, and it has separately proposed Starmind, a constellation of up to a million satellites designed to run AI computation directly in orbit rather than just relay data. Musk has said he expects space to become the cheapest place to deploy AI compute within two to three years. Starlink and Starmind serve different jobs inside that vision, one moving data and the other processing it, but Sunday’s posts treat vehicles as one more category of hardware that will eventually need both.
None of this changes anything for Tesla owners today. Cars already on the road keep running on LTE and Wi-Fi, and Tesla hasn’t outlined a retrofit path for existing vehicles. The July 22 commitment applies to future production, not the fleet already delivered. What Musk added on Sunday is the reasoning: satellite connectivity isn’t a Cybercab novelty, it’s a bet that ground based networks won’t keep up with how much data cars, robots, and AI systems are about to generate.
SpaceX stock did the opposite of what most of Wall Street expected this week, when the day designed to be its most dangerous turned into a rally, and the rally kept going.
Thursday marked the first major lockup expiration since SpaceX’s June IPO, making roughly 911.5 million insider held shares eligible to trade for the first time, more than doubling the company’s public float. Analysts and short sellers had spent weeks bracing for a flood of selling, especially after the stock fell 13 percent following its first earnings report as a public company on Tuesday. Instead, shares rose 6.1 percent Thursday to close at $114.92, and by Friday they were trading near $129, up more than another 12 percent on the day.
SpaceX shorts get warned by Musk ally, echoing Tesla’s early struggles
The setup made the outcome notable. Short interest had climbed to roughly 34 percent of the float heading into earnings, among the highest of any large cap stock, with about 95 percent of available shares to borrow already on loan. CEO Elon Musk warned short sellers twice in the weeks before the lockup, writing on X that “the survival probability of firms who maintain a significant short position in SpaceX over time is very low,” then following up on the morning of earnings with “I try to warn them, but they just double down.”
When the newly unlocked shares hit the market and the selloff never showed up, some of that short position appears to have started unwinding. TipRanks reported that options activity shifted toward bullish strategies like put selling and risk reversals following the rally, with roughly $600 million in options premium trading Thursday alone. Retail buyers also stepped in during the earnings dip, according to Vanda Research.
The fundamentals behind the stock have not changed much in a week. SpaceX’s revenue nearly doubled year over year to $7.8 billion, with Starlink subscribers doubling to 12 million and the company’s AI segment growing 247 percent. What spooked investors on Tuesday was the spending side. Capital expenditures jumped to more than $18 billion for the quarter, up from $2.8 billion a year earlier, with AI investment alone rising from $749 million to $15.8 billion. Wall Street remains split on whether that spending is building infrastructure SpaceX needs or outrunning what the business can currently support, a debate Teslarati has tracked since shares first came under pressure.
None of that resolves the bigger question hanging over the stock. Thursday’s release was only the first of nine staggered lockup tranches, with roughly $800 billion worth of additional shares scheduled to become eligible through October, and Musk’s own stake stays locked until next June. If this week is any indication, the market is treating that supply as something it can absorb rather than something to fear, at least for now.
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Cybertruck
Tesla Cybertruck production snaps back after ugly supplier fight
Cybertrucks are piling up again at Giga Texas after Tesla’s court win against a parts supplier.
Cybertruck production at Giga Texas is showing its first visible recovery since Tesla sued a supplier last month over withheld manufacturing tooling.
Aerial observer Joe Tegtmeyer flew over the Austin factory Wednesday morning and counted roughly 100 or more Cybertrucks filling the outbound lot, a sharp jump from the thin numbers seen in recent weeks. The flyover came a day after a judge granted Tesla a temporary restraining order against Angstrom Automotive Group, the parts supplier at the center of the dispute.
Tesla filed an emergency lawsuit in late July after Angstrom told the automaker it planned to close the Troy, Texas facility where Tesla’s die-cast tools, trim dies and other Cybertruck stamping equipment were housed. According to Tesla’s complaint, a shipment of 700 finished parts never left the building, and when Tesla sent representatives to retrieve its equipment, accompanied by law enforcement, they were turned away. Angstrom allegedly then asked for an extra $250,000 a week to keep operating, which Tesla’s filing described as holding its own property for ransom.
TESLA: U.S. District Judge Christopher R. Wolfe of the U.S. District Court for the Western District of Texas, Waco Division granted Tesla a Temporary Restraining Order and Writ of Replevin in its dispute with Angstrom Automotive (Case No. 6:26-cv-00477).
The order authorizes… https://t.co/E1DKcQSxMn pic.twitter.com/LR8aAiV2Og
— S.E. Robinson, Jr. (@SERobinsonJr) August 5, 2026
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The restraining order gives Tesla immediate right of entry to Angstrom’s facility to recover the tooling. It is temporary, with a fuller hearing still to come, but the speed of Wednesday’s rebound suggests the Angstrom shortage was indeed the main bottleneck limiting Cybertruck output. Outbound lot counts are an imperfect measure of actual production, since finished trucks can sit for days before shipping, but a lot that full after a lean stretch is a meaningful signal.
Cybertruck output at Giga Texas has fluctuated all year as Tesla worked through supply issues and introduced new trims, including a cheaper Dual Motor AWD version that drew strong early demand.
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