CNBC Daily Open: Tesla's revenue rose — but so did its operating costs

Core Insights - Tesla's revenue increased by 12% year-on-year in Q3, marking the first rise in three quarters, but net income fell by 37% compared to the previous year [1][2] Group 1: Financial Performance - Revenue growth of 12% year-on-year indicates a recovery in sales after two quarters of decline [1] - Net income decline of 37% highlights the impact of rising costs overshadowing revenue growth [1] Group 2: Cost Factors - Lower vehicle prices were implemented to compete with Chinese manufacturers, contributing to the profit decline [2] - Operating expenses increased by 50%, driven by investments in artificial intelligence and other R&D projects [2] Group 3: Market Reaction - Tesla's earnings report led to a 3.8% drop in its shares during extended trading, reflecting investor dissatisfaction [3] - The negative sentiment from Tesla's report followed disappointing earnings from Netflix and Texas Instruments, which saw their shares decline by 10% and 5.6% respectively [3] Group 4: Broader Market Impact - The declines in major tech stocks contributed to a broader market downturn, with the S&P 500 and Nasdaq Composite facing potential declines for October [4] - Upcoming earnings reports from major tech companies like Alphabet, Apple, Meta, and Microsoft could influence market recovery in the remaining trading days of October [4]