Tesla Surges 11% After Q3 Earnings Beat as Musk Teases Affordable EV and Record Deliveries

Tesla's third-quarter earnings exceeded expectations, with the company's stock surging over 11% in after-hours trading. For Q3 2024, Tesla reported $25.182 billion in revenue, marking an 8% year-over-year increase, though slightly under market forecasts. GAAP net income reached $2.167 billion, a 17% rise that surpassed analyst predictions. The gross profit margin increased to 19.8%, improving by approximately 2 percentage points from the previous year.

The surge in delivery volumes significantly contributed to Tesla's strong performance. The company delivered 463,000 vehicles in the third quarter, a 6.4% year-over-year increase, setting a record for Q3 deliveries. Notably, the cost per vehicle sold (COGS) dropped to its lowest-ever level at approximately $35,100, enhancing profitability.

Elon Musk, Tesla's CEO, confirmed plans to launch a more affordable electric vehicle in the first half of 2025, a model investors are referring to as the "Model 2." Musk reiterated the importance of incorporating autonomous driving technology, asserting that an entry-level vehicle would be "pointless" without it. The anticipated price for this new model is below $30,000.

Musk also projected a 20%-30% increase in vehicle sales next year, driven by reduced automotive costs and advancements in autonomous technology. Furthermore, Tesla is developing a ride-hailing app expected to roll out in California and Texas next year, indicating the brand's strategic expansion into mobility services.

These forward-looking plans underscore Tesla's commitment to expanding its footprint in the electric vehicle sector and emphasize the strategic importance of affordable EVs. The introduction of an economical EV model is likely to propel growth in the electric vehicle market and drive further technological innovation.