Tesla Stock Surges: Investors Cheer Q3 Earnings Report

Tesla's stock price soared on Thursday, marking its best day since 2013, as investors reacted positively to the company's Q3 earnings report. The electric vehicle (EV) giant reported earnings per share (EPS) of $0.72, surpassing Wall Street's expectations of $0.58. Total revenues also rose to $25.182 billion, up 8% year-over-year, with automotive revenues reaching $20 billion, a 2% annual increase.


Tesla's gross margins and operating profit margins contributed significantly to its Q3 earnings growth. The company reported a gross margin of 19.8%, up 195 basis points compared to the previous year. Tesla Energy's gross margins even hit a record high of 30.5%. This improvement in margins, coupled with a historic low in cost of goods sold (COGS) per vehicle at about $35,100, drove Tesla's earnings growth.


Tesla's vehicle deliveries and energy storage deployments also played a crucial role in its Q3 earnings performance. The company delivered 462,890 vehicles in the quarter, a 6% increase from the previous year. Despite facing macroeconomic headwinds, Tesla expects slight growth in vehicle deliveries for 2024. Additionally, energy storage deployments are expected to more than double year-over-year in 2024.


Tesla's strong Q3 earnings report has reinvigorated investor confidence in the company. The stock jumped by 20% after hours on Wednesday and another 14% in pre-market trade on Thursday. Analysts have raised their price targets, with Cannacord Genuity analyst George Gianarikas increasing his target to $278 per share from $254 per share. Wedbush Securities analyst Dan Ives maintained an outperform rating and a $300 per share price target.


In conclusion, Tesla's Q3 earnings report has sparked a surge in investor confidence, with the stock experiencing its best day since 2013. The company's improved gross margins, reduced COGS, and strong vehicle deliveries contributed to its earnings growth. As Tesla continues to expand its vehicle and energy product lineup, reduce costs, and invest in AI projects and production capacity, investors remain optimistic about the company's future prospects.