Together, that helped overall revenues grow by 2 percent year over year to $25.5 billion, with a gross profit of $4.5 billion (a 1 percent increase year over year). But once generally accepted accounting principles are applied, net profits fell by 45 percent year over year to $1.5 billion. The company’s operating margin—once the envy of the industry—dropped 33 percent year over year to just 6.3 percent.
Tesla’s operating expenses have jumped 39 percent year over year to $3 billion a year, and its capital expenditures increased by 10 percent over the same timeframe, but encouragingly, compared to last quarter, its net cash and free cash flow appear far healthier. (Both have increased year over year as well.)
Although Tesla CEO Elon Musk has repeatedly claimed that Tesla is now an AI company, there was little mention of how AI will contribute to the company’s coffers in the coming years, beyond the fact that it expects its “hardware-related profits to be accompanied by an acceleration of AI, software, and fleet-based profits.”
However, Tesla said that it plans to start production on new vehicles during the first half of next year, “including more affordable models.” These will apparently use a mishmash of Tesla’s current vehicles and a next-generation platform that the automaker is still designing.
