Tesla Shares Stumble 5% After Third Quarter Profit Sinks

Core Insights - Tesla's shares fell 5% following the announcement of third-quarter earnings, despite achieving record sales [1][2] - The company reported revenues of $28.09 billion, exceeding Wall Street's expectations, but profits decreased significantly [2][5] Financial Performance - Tesla's third-quarter revenues were $28.09 billion, surpassing estimates of $26.5 billion and reflecting a 24.8% increase from the previous quarter [2] - Earnings per share were $0.50, below the expected $0.56, and profits totaled $1.4 billion, marking a 37% decline from the same period last year [2] Market Context - The decline in profits coincided with the expiration of a $7,500 federal tax credit for electric vehicles, which may impact future sales [5] - Tesla delivered over 497,000 vehicles in the third quarter, the highest number on record for the company [5] Strategic Focus - During the earnings call, CEO Elon Musk emphasized Tesla's advancements in AI and the development of the humanoid robot, Optimus, rather than addressing shareholder concerns about new car models and the impact of the tax credit expiration [3] - Musk indicated that Tesla's AI chip, AI5, would be produced by Samsung and TSMC, and reaffirmed that the company would continue using Nvidia's chips for model training [3] Leadership and Governance - Musk criticized shareholder advisory firms that opposed his $1 trillion pay package, labeling them as "corporate terrorists" [3] - Despite the controversies, Musk's wealth is estimated at $487.5 billion, having recently surpassed the $500 billion mark [4]