Investor's Corner
Tesla’s Q3 results and Wall St’s reaction: When record deliveries is bad news
Tesla’s (NASDAQ:TSLA) third-quarter results set new production and vehicle delivery records for the electric car maker. With a total of 96,155 electric cars produced and about 97,000 delivered between July and September, as well as an update that revealed that the company achieved record net orders in Q3, Tesla’s results were objectively impressive.
Yet, the market’s reaction to Tesla’s Q3 results was unforgiving. TSLA stock dipped over 4% in after-hours trading following the company’s release of its record third-quarter results. Bearish outlooks were shared by analysts covering the company once more, and questions about the demand for Tesla’s vehicles were rekindled.
A key driver of this negative narrative was Tesla’s reported miss of Wall Street’s expectations, as analysts polled by FactSet had an average estimate of 99,000 deliveries for Q3 2019. It should be noted that this estimate did not represent the latest consensus numbers from the greater number of analysts covering the company prior to the release of the Q3 production and delivery results.
FactSet usually utilizes about 10-12 analyst estimates to create a consensus, but over 20 analysts are covering Tesla. If one were to list the average estimates from 21 financial firms covering the electric car maker, one would see that Tesla’s “miss” might not really be a miss at all. In fact, it would appear that Tesla actually met Wall Street’s expectations.
Among New Street, Baird, BAML, Nomura, CSFB, Macquarie, Bernstein, DB, Cowen, JPM, OpCo, CE, MS, UBS, Wolfe, JMP, Needham, ISI, RBC, Barclays, and Wedbush, the actual delivery estimates among analysts covering the company was 94,422 units, comprised of 76,831 Model 3 and 17,591 Model S and X. That’s more conservative compared to Tesla’s 97,000 deliveries, comprised of 79,600 Model 3 and 17,400 Model S and X.
In a way, a good part of the bearish narrative that emerged following the release of the Q3 2019 results was due to a delivery target quoted in a leaked Elon Musk email that made the rounds just days before the end of the quarter. In the message, Musk rallied Tesla’s employees to push deliveries since the company has a chance of hitting 100,000 deliveries in Q3. That 100,000 delivery target was not official guidance from Tesla, but it seemed like it was practically considered as such by some analysts covering the electric car maker.
With Tesla’s official delivery figures falling short of the 100,000 mark, it became pretty easy to frame the narrative as a disappointing quarter for deliveries. The numbers are anything but, especially considering that sales among veteran automakers in the United States experienced a difficult third quarter.
Japanese carmakers Toyota and Honda, two of the US’ leading Asian automakers, suffered double-digit declines that were worse than analysts anticipated. Ford, the maker of America’s most popular vehicle, also saw its sales sink by 4.9% year-over-year. Compared to these, Tesla’s 16.2% year-over-year improvement in deliveries is quite impressive.
In the aftermath of Tesla’s Q3 2019 results and the unfortunate reaction of the market, is Tesla completely blameless? Not completely. It is unfortunate, but executives such as Elon Musk must realize that at this point, Tesla is playing a game that is not exactly fair, as evidenced by the CEO’s informal delivery target seemingly being considered as guidance by some analysts. In this light, emails with lofty forecasts might prove unwise in the future, or stronger safeguards must at least be placed to ensure that no internal emails are leaked.
As of writing, Tesla stock is trading -6.53% at $227.26 per share.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
Investor's Corner
Tesla has a Cybercab problem nobody saw coming
Tesla’s Cybercab line now builds robotaxis faster than Tesla can deploy them, Lars Moravy says.
Tesla’s Cybercab line in Texas can now build the two seat robotaxi faster than the company can put it into service, according to Lars Moravy, Tesla’s Vice President of Vehicle Engineering. “We don’t run every day because the line can run so fast. It’s currently outpacing our deployments,” Moravy said in a new Cybercab deep dive from Munro Live. “So, it’s a bit of a race right now. Who’s going to go faster? Right now the manufacturing line’s ahead.”
Tesla’s official Robotaxi account shared a Cybercab analysis video on X on Monday, calling it a “Cybercab engineering deep dive.” Moravy’s comments go further than what he told analysts on the Q3 earnings call last week, when he said the Cybercab line’s listed capacity of more than 125,000 units a year undersells what it can actually run.
The tour shows where that speed comes from. Tesla’s unboxed process splits the Cybercab into front, rear, side and center modules that are built and tested on their own before they meet on a short final line. That final line has just 25 fully automated stations, which Tesla’s team estimated is a fifth to a tenth of what a Model Y needs. The full line is about 78% automated, the framing line is already at 100%, and the layout uses roughly 50% less floor space per vehicle. The stated goal is “100% automation in 10 second cycle time,” or one finished Cybercab every 10 seconds.
Tesla also deleted the paint shop. Only the side modules are coated, and the exterior panels get their color inside the molding machine. Engineers said the car is designed to run at least 500,000 miles, which matters for a vehicle that will spend most of its day carrying riders.
The battery got the same treatment. The Cybercab uses an 88S6P pack of 4680 cells in a steel enclosure, a first for Tesla, with each module potted separately so a single failed module can be swapped instead of the whole pack. Wireless battery management boards replace a wiring harness, and new contactors are fast enough to drop the pyro fuse entirely. Tesla’s battery director graded the pack an A minus, compared with a D for the Model Y structural pack and a B minus for Cybertruck. Up front, the drive unit runs an 11:1 gear ratio versus roughly 9:1 on most Teslas, since the Cybercab does not need a high top speed.
Cybercab engineering deep dive — Robotaxi (@robotaxi) October 26, 2026
The deployment side is now the bottleneck Moravy described. Tesla had more than 50 Cybercabs working the Formula 1 weekend in Austin, and Texas records show 463 Cybercabs registered. Tesla said on its earnings call that Cybercab service will launch in Dallas next month, and Moravy said the company is aiming to get Cybercabs to customers by the end of 2026. Every unit built so far has gone into Tesla’s own fleet since the line moved into volume production in April.
Munro Live also asked when it could get a Cybercab to tear down. Tesla’s answer: “Not yet.”
Tesla (NASDAQ: TSLA) reported its earnings for the third quarter of 2026, marking a reasonable performance on the various financial metrics. Tesla still plans to hold a call that will field investor questions at 5:30 p.m. ET, 4:30 p.m. CT.
Here’s where Earnings came in:
- Total Revenues: $28.046 reported vs. $28.34B expected
- Non-GAAP EPS: $0.48 reported vs. $0.45 expected
- Operating Margin: 2.6 % reported vs. 2.5% expected
- Operating Income: $718M reported vs. $721M expected
- Free Cash Flow: $1.531B reported vs. ~-$4.51B expected
Tesla $TSLA Earnings Results:
Revenues: $28.046B
Non-GAAP EPS: $0.48
Operating Margin: 2.6%
Operating Income: $718M
FCF: $1.531B— TESLARATI (@Teslarati) October 21, 2026
Major Takeaways
Full Self-Driving (Supervised)
“FSD (Supervised)⁴ attach rate continued to grow, reaching over 75% of new vehicle deliveries in North America – our most mature market – a nearly twenty percentage point sequential increase. We believe that FSD is driving demand in markets where it is available, and we continue to work with regulators to get it approved in other markets.”
Tesla Semi
“We began volume production of Tesla Semi, our Class 8 heavy-duty truck. The top variant can go 500 miles at full 82,000 lbs gross combination weight while achieving an efficiency of 1.7 kWh/mile. That efficiency allows the Tesla Semi to use a third of the energy used by a comparable diesel truck to haul the same payload. In a transportation market where energy is one of the largest components of total cost per mile, this will provide a meaningful advantage to Tesla Semi operators.”
SI Compute
“We plan to reach 400 MW of SI training compute by the end of the year, supporting the development of both vehicle and humanoid robot autonomy software. Additionally, we continued construction for the Austin Fab, where we plan to start commissioning equipment in 2027.”
Robotaxi
“We began deployment of Cybercab into our Robotaxi fleet in Austin. We reached nearly two million cumulative unsupervised miles for our Robotaxi service as of the end of the quarter. Operating hours in Austin are now 6am to midnight, and we expect to reduce wait times via increased fleet supply and improvement of Robotaxi orchestration algorithms. Grok is available in Cybercab with access to Grok Bot and Connectors, which allows users to manage their inbox, calendars, files, chats and tasks – all hands free via voice command – making Cybercab a mode of transport, a productivity space and, with our entertainment options, a second living room.”
Interested in ordering a Tesla? Use my referral code for three free months of Full Self-Driving (Supervised) here.
Tesla (NASDAQ: TSLA) reports its earnings for Q3 today. Here’s what to expect, as the company will reveal its balance sheet after the market closes on Wednesday.
Tesla already reported deliveries just after Q3 ended, and it demolished Wall Street consensus estimates of roughly 462,000 vehicles. Tesla delivered 486,532 cars in the third quarter, which was a big beat, but was down 2.1 percent from the same quarter last year. Energy storage deployments were 13.7 GWh, up year-over-year.
Tesla showrooms picked clean ahead of Q3 end as demand looks strong
For the quarter, analysts have already compiled their predictions for what Tesla will report this afternoon:
- Total Revenues: $28.34B
- Non-GAAP EPS: $0.43
- Operating Margin: 2.5%
- Operating Income: $721M
- Free Cash Flow: ~-$4.51B
Here are a few things we are looking forward to hearing about on the call:
Automotive Gross Margin and Overall Profitability
This was 16.3 percent in Q2, down from 19.2 percent in Q1, and was impacted by warranty charges and some fading regulatory credits. Consensus implies overall gross margin near 18 percent, but a miss here would potentially reinforce concerns about pricing pressure on its vehicles.
Pay attention to energy storage margins as well, especially since Tesla missed GWh expectations, although it was still a strong quarter.
Robotaxi/Cybercab, Unsupervised FSD, and Optimus Progress
The Say questions from retail investors usually focus on these types of projects, and this quarter is no different. Scaling the Cybercab fleet beyond Austin amid the open NHTSA safety review, timeline for Unsupervised FSD in customer cars, Robotaxi unit economics, and Optimus cost per unit plus when it could start generating revenue, are all things to be looking for.
Any concrete timelines or regulatory path details will likely move the stock more than the near-term numbers. SpaceX merger speculation, which was detailed during SpaceX’s earnings call last night, may also surface, although the key details were shared last night.
Elon Musk just confirmed the Tesla and SpaceX merger step everyone was waiting for
Say Investor Questions
- How does the Cybercab fleet scale past Austin, and what’s the regulatory path outside Texas given NHTSA’s open safety review?
- When can we anticipate FSD unsupervised in customer cars?
- When will the CyberCab be available for customer purchase/ownership?
- What’s the unit economics per paid robotaxi mile, and how does it compare to the thirty-cent target?
- Tesla has acknowledged that HW3 vehicles cannot support unsupervised FSD. When will owners know whether they can upgrade their hardware for free, and when will Tesla provide a clear plan?
The full Earnings Call will be streamed this evening after market close around 5 p.m. this evening.
Tesla has a Cybercab problem nobody saw coming
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