(Reuters) – Tesla reported a higher-than-expected third-quarter profit margin on Wednesday even as it offered lucrative financial incentives to boost demand for its aging electric vehicle lineup.
Shares of the Austin, Texas-based automaker rose 4.8% in trading after the bell.
Tesla said earlier this month that deliveries in the September quarter grew more than 6% year over year, marking the first quarter of growth after a decline in the January-June period.
Tesla cut prices last year, leading to a sharp decline in profit margins. This spring, it shifted its strategy to offering cheaper financing options and discounts that analysts said could slow margin bleeding in coming quarters.
Prices of raw materials used to make EV batteries have fallen and Tesla has said this will reduce costs this year, with the effect diminishing over time.
Earlier this month, Tesla unveiled its robotaxi product, called Cybercab, and a 20-seat self-driving van as the company looks to accelerate the development of its autonomous technologies, including the Optimus humanoid robot.
Revenue for the July-September quarter was $25.18 billion, compared with estimates of $25.37 billion, according to data compiled by LSEG. It reported revenues of $23.35 billion in the corresponding quarter of 2023.
Adjusted earnings were 72 cents per share in the third quarter, better than the average estimate of 58 cents.
The company’s profit margin of 19.8% in the July-September period topped estimates of 17.3%, according to 21 analysts surveyed by LSEG. That compared to 18% in the second quarter.
(Reporting by Akash Sriram in Bengaluru and Abhirup Roy in San Francisco; Editing by Sriraj Kalluvila)
