Tesla Q3 Earnings Loom After Market Close, But Retail Crowd Tunes Out As Bearish Sentiment Builds

Electric-vehicle giant Tesla, Inc. ($TSLA) is expected to report its much-awaited third-quarter earnings after the market closes on Wednesday, but retail sentiment toward the stock has remained bearish for a while.

Key Numbers

Analysts, on average, expect the company to report non-GAAP earnings per share (EPS) of $0.59 vs. $0.66 reported for a year ago and $0.52 earned in the previous quarter. 

The Elon Musk-led company is set to report its third straight quarter of earnings decline as price cuts and incentives aimed at boosting the topline hurt margins. 

Revenue is estimated at $25.47 billion, up from the $23.35 billion reported for the year-ago quarter and nearly flat with the preceding quarter $25.50 billion. 

Apart from these headline numbers, the focus is likely to be on the auto gross margin, excluding regulatory credits, also called core gross margin. 

Fund manager Gary Black, a Tesla bull, models core gross margin of 14.2% compared to the consensus estimate of 14.9%, attributing his below-consensus view to Tesla’s 0.99% promo loan rate offered globally.

Tesla doubled its energy and storage revenue year-over-year in the second quarter to $3.01 billion, or roughly 12% of the total revenue.

Q3 Deliveries

Earlier this month, Tesla reported third-quarter deliveries of 462,890 units, falling below Wall Street’s so-called “whisper number” estimate.

Earnings Call Focus

Traders may look ahead to forward deliveries guidance on the earnings call hosted by the management at 5:30 pm ET. Musk has hinted at growth from the 1.81 million units delivered in 2023, which leaves the company with a tall order of selling 514,925 EVs in the fourth quarter.

Other focus areas are updates on timeline for robotaxi launch and a sub-$30,00 EV, the fructification of unsupervised full self-driving,  and the core gross margin guidance.

On Stocktwits, sentiment score for Tesla was 41/100 as of 12:30 pm ET, suggesting ‘bearish’ mood, and message volume remained ‘normal.’

Retail traders see the stock trading out of sync with weak fundamentals 

Tesla Stock

As of 12:30 pm ET, Tesla stock traded down 1.68% to $214.30. It is trading well off its all-time closing high of $409.97 reached on November 3, 2021. 

Read Next: Texas Instruments Stock Rises On Solid Q3 Results But Retail Sentiment Nosedives

For updates and corrections email newsroom@stocktwits.com 

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