Key Takeaways
- Tesla stock fell 3% on Thursday after its third-quarter adjusted earnings of $0.48 per share beat the $0.45 analysts expected.
- Even after Tesla cut its 2026 capex budget to about $20 billion, it still plans to spend more than twice what it spent in 2025.
- Elon Musk said Optimus will take at least a year to reach full production. That’s the bigger worry for the stock.
- Tesla’s forward P/E is still far above its five-year average of 108x. That’s a lot to pay for robots that are still a year or more from full production.
Tesla (TSLA) beat Wall Street’s third-quarter earnings estimates after Wednesday’s close. The stock fell 3% on Thursday anyway, closing at $375.
Investors are looking past the beat to what Tesla said about the next year.
The numbers held up
Adjusted earnings came in at $0.48 per share, ahead of the $0.45 analysts expected. Plus:
- Automotive gross margin excluding regulatory credits rose to 18.1%, from 15.4% a year earlier.
- Free cash flow swung back to $1.5 billion, after a $1.1 billion outflow in the second quarter.
- Active paid FSD customers—including upfront purchasers and monthly subscribers—climbed 67% from a year earlier, to 1.74 million.
GAAP net income did fall 43% from a year earlier to $787 million, as operating expenses rose 39%, mostly on R&D. (Revenue was flat at $28.0 billion.)
Less spending, slower robots
On Tesla’s third-quarter call, CFO Vaibhav Taneja said the company is “revising our CapEx guidance to be approximately $20 billion for the current year as a result of managing our capital deployment efficiently.” The old plan was more than $25 billion.
Elon Musk added that Optimus, now in early production in Fremont, would take “probably at least a year, maybe a little longer” to reach a rate of 20,000 robots a week. He still believes “Optimus will be the biggest product on Earth.”
Investors took both comments to mean the AI and robotics payoff is further away. But Tesla is hardly pulling back. Its cash from operations has covered capex every year since 2021, with plenty to spare…
…and $20 billion is more than twice 2025’s $8.5 billion. It’s also more than the $18.7 billion its operations brought in over the last 12 months. With $13.0 billion spent through September, the fourth quarter could still be Tesla’s biggest spending quarter since 2023.
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A long wait at Tesla’s price
The Optimus timeline matters more, because the stock already prices it in. Tesla traded at 185x forward earnings at Wednesday’s close, far above its five-year average of 108x…
Thursday’s drop only brings that down to about 179x.
This was a solid quarter. At nearly 180x forward earnings, though, Tesla needs Optimus to deliver, and a year or more is a long time to wait for it. I’d stay on the sidelines until the ramp shows up in the numbers.
Of course, Musk expects the robot’s remaining design and AI problems to be solved around the end of next year, when Tesla plans to start delivering Optimus to other companies. If he hits that date, Thursday’s drop could look like an overreaction.
So what is Tesla stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
