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Tesla’s Q3 2018 earnings call: What we expect to see

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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.

A fleet of Tesla Model 3.

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.

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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.

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’s 100 MW/129 MWh Powerpack system dubbed as the ‘World’s largest battery’ in Jamestown, Australia.

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.

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Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Elon Musk and Trump are closer than ever, and Tesla could be the big winner

Elon Musk sat beside Trump as AI leaders signed a voluntary White House safety accord.

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Elon Musk had the seat right next to President Donald Trump on Tuesday as the White House hosted the leaders of America’s biggest artificial intelligence companies for a lunch that ended with a voluntary industry accord on AI safety.

A seating chart Trump posted on Truth Social placed Musk at the president’s left in the East Room, with Nvidia CEO Jensen Huang on his right, according to an Associated Press reporter. Anthropic CEO Dario Amodei, OpenAI President Greg Brockman, Meta’s Mark Zuckerberg, Google’s Sundar Pichai, Microsoft’s Satya Nadella and Amazon founder Jeff Bezos also attended, along with Vice President JD Vance and House Speaker Mike Johnson.

After the lunch, Trump told reporters outside the West Wing that the executives had signed “The White House Accord on Superintelligence: A Joint Commitment on Frontier SI Responsibilities.” Johnson described it as a voluntary statement of principles built on “robust internal controls and layers of internal and external review,” while Zuckerberg said company boards would independently review reports from outside auditors. Trump called the document “morally binding,” said he would name a new AI czar within days, and signed an executive order formally renaming artificial intelligence “super intelligence,” CNBC reported.

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Musk was not in the room for Tesla alone. Since SpaceX absorbed xAI, he runs the company behind Grok and one of the largest AI training operations anywhere. On September 25, he said another 220,000 Nvidia GB300 chips would come online at Colossus 2 within a week, with more expected in November and December.

SpaceX confirms third massive compute deal at Colossus data center

 

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Musk also used the trip to restate his energy ambitions. “SpaceX is aiming together with Tesla to do 200 gigawatts of solar production per year,” he said at an event in Washington. It is the same combined target he laid out that feeds directly into Terafab, the Tesla and SpaceX chip venture that will need enormous amounts of power.

The showing between Musk and Trump has come a long way, since the two had the very public split in mid 2025 after Musk opposed the “Big Beautiful Bill” and left DOGE. They reconciled at Charlie Kirk’s memorial that September, and Trump later called their relationship “good”. Since then, Musk has joined Trump’s China delegation in May and attended last week’s White House state dinner for Chinese President Xi Jinping.

For Tesla, that access to government official could pay dividends. As Teslarati noted in January, federal autonomy rules, NHTSA oversight and a single national standard for driverless vehicles all run through an administration Musk can more easily reach directly as Tesla works to scale Robotaxi and Cybercab beyond Texas.

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Investor's Corner

Tesla showrooms picked clean ahead of Q3 end as demand looks strong

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Credit: @thaichiminh1907/X

Tesla (NASDAQ: TSLA) showrooms have been picked clean ahead of the end of the third quarter of the year, as demand looks to be strong and delivery estimates for new vehicles are pushed into late 2026 and early 2027.

Tesla appears to have sold out of many of its Model 3 and Model Y trim levels in the United States, as only the Model Y RWD and Model Y All-Wheel-Drive are available for delivery before the end of the year.

Additionally, many showrooms are either completely empty or void of all but just one demo unit within the buildings themselves in an effort to bolster what could be one of Tesla’s best quarters in vehicle deliveries in recent memory.

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Additionally, when I spoke to the guys at Tesla Mechanicsburg two weeks ago, when I returned the Model Y L, their third hauler of the week had just arrived, and every vehicle on it, along with every vehicle in their delivery lot, was accounted for and had a name attached to it for delivery.

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Tesla saw a 25 percent increase in deliveries in Q2 compared to the same quarter the year before. The vast majority of the 480,126 units it delivered, 467,762 vehicles to be exact, were the Model 3 and Model Y.

In Q3 2025, Tesla delivered 497,099 vehicles, once again a figure that was dominated by the company’s two mass-market vehicles. Analysts have unusually wide predictions for this quarter, likely because so many firms missed the Q2 delivery figure by such a substantial margin; Wall Street predicted 408,000 cars, while Tesla delivered 480,000.

Goldman Sachs has Tesla slotted for 435,000 deliveries in Q3, while JPMorgan said it anticipates 482,000. The median guess is about 449,000 deliveries for Q3.

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Interested in ordering a Tesla? Use my referral code for three free months of Full Self-Driving (Supervised) here.

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SpaceX turned a heralding moment for Starship into its greatest

Starship reached orbit despite losing an engine, deployed 26 Starlink V3 satellites on Flight 14.

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SpaceX’s Starship reached orbit for the first time on Monday, and for a few nail-biting minutes it looked like it wouldn’t. During ascent on Flight 14, one of Ship 41’s six Raptor engines shut down early, and SpaceX’s livestream host Dan Huot told viewers the team had decided not to commit to orbit. Minutes later, after what Huot described as a lot of conversation in the control room, the final poll came back in favor, and a roughly 19 second burn of a single Raptor pushed the ship into orbit about 170 miles up.

The reversal matters because SpaceX had written the exit ramp into the mission plan. The company said it would only fire the orbital insertion burn if flight controllers confirmed enough backup hardware remained for the deorbit burn, a condition Teslarati laid out ahead of the flight. Losing an engine was exactly the scenario that rule was built for.

Pressing forward fits Elon Musk’s history. Falcon 1 failed three straight times before its fourth launch reached orbit in 2008, with SpaceX nearly out of money, and Starship was developed by flying prototypes until they broke. What changed this year SpaceX going public, and with $SPCX sliding below its IPO price in July when Flight 13 slipped, the short interest climbed significantly, as Teslarati reported at the time. A Starship potentially lost today with revenue generating next-gen Starlink satellites aboard would have landed directly on shareholders.

That pressure showed up after orbit. SpaceX cut a flight planned to last nearly 10 hours to about three, moving splashdown from west of Chile to the North Pacific near Hawaii. SpaceX gave no reason, though Musk said this month the company was being extremely cautious about debris risk. The single Raptor for deorbit worked, and Ship 41 completed its flip and landing burn before breaking apart in the water, an outcome SpaceX expected. Musk has structured SpaceX’s governance to shield long term bets from market pressure.

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The payload is the bigger business story. Musk posted that all 26 Starlink V3 satellites deployed and are “operating nominally.” Each V3 is rated for about 1 Tbps of downlink and 160 Gbps of uplink, so this single launch adds roughly 26 Tbps, about 10 times what a Falcon 9 load of V2 Mini satellites adds. The V3 is too large for Falcon 9, making Starship the only vehicle that can build out the planned 100,000 satellite constellation, at up to 60 per flight once it reaches routine service. Unlike the 20 V3 units on Flight 13, which reentered on a suborbital path, these will raise their orbits and could begin serving customers within weeks and bring in hundreds of millions of additional dollars in projected Starlink revenue.

SpaceX has already begun winding down Falcon 9 Starlink launches from Florida in favor of Starship. Reported targets put Flight 15 as early as October 19, leaving about three weeks to diagnose Monday’s engine shutdown before the next orbital attempt.

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