Profits at Musk’s car company plunged again last quarter even as it sold more vehicles

By BERNARD CONDON

NEW YORK (AP) — Tesla, the car company run by Elon Musk, reported Wednesday that it sold more vehicles in the past three months after boycotts hit hard earlier this year, but profits still fell sharply.

Third-quarter earnings at Tesla fell to $1.4 billion, or 39 cents a share, from $2.2 billion, or 62 cents a share, a year earlier. That marked the fourth quarter in a row that profit dropped. Excluding certain charges, earning were 50 cents per share, down from 72 cents per share a year ago and below the 56 cents forecast by Wall Street analysts.

Revenue rose to $28.1 billion from $25.2 billion in the June through September period, beating Wall Street’s forecast.

Tesla shares fell 1% to $434.82 in after-hours trading

Financial analysts have been upping their estimates of revenue since Musk announced earlier this month that sales of electric vehicles, one part of the multipronged business, rose 7% in the quarter after plunging for most of the year.

The sales were boosted by customers rushing to take advantage of a $7,500 federal tax credit for those EV purchases before it expired on Oct. 1, possibly stealing sales from the current quarter.

Tesla was also helped by surging sales from its separate battery storage business, but the EVs still make up much of the overall revenue figures.

A much watched measure, gross margins, hit 18%, the highest for this year but still down from the third quarter a year ago. The figure, which shows how much money Tesla makes after paying staff, raw materials and other basic expenses, are also down from 25% four years ago as the company offers discounts and other incentives to fight back against rival EV makers that have been stealing market share.

Musk was predicting 20% to 30% sales growth for 2025 at this time last year, but it hasn’t turned out that way.

In addition to alienating potential customers with his embrace of right-wing politicians, sparking boycotts in key markets here and abroad, he also has failed to shake up his vehicle lineup with a new, exciting model or introduce a substantially cheaper car to appeal to the mass market.

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An earlier version of this story incorrectly reported that Tesla’s profit had dropped for three straight quarters.