Forget the Robotaxi: Wall Street cares about Tesla's business basics

• Tesla's Q3 net hit expectations, boosting banal aft nan Robotaxi announcement's disappointment.
• Strong margins and an uptick successful 2024 income maturation buoyed investors' return connected Tesla.
• Analysts said they're looking astatine fundamentals of Tesla's car business.

Tesla's third-quarter net study connected Wednesday hit expectations, lifting Elon Musk's institution retired of its little banal rut that followed nan Robotaxi unveiling earlier this month.

Analysts saw nan latest numbers arsenic a clear motion that Tesla shouldn't neglect its roots. Ahead of nan report, they were watching for results from nan company's halfway business: electrical conveyance sales.

Tesla reported a third-quarter profit beat, saying it expects a flimsy year-over-year maturation successful vehicle sales for 2024. On nan net telephone aft nan study was released, Musk said he expects Tesla's conveyance income to summation by 20% to 30% adjacent year. The CEO is known for optimistic estimates.

"Self-driving software, A.I., and robotics are still nan cardinal to nan semipermanent thesis," Piper Sandler analysts wrote successful a memo sent aft nan net call. "But it boosts investor sentiment whenever nan guidelines business is performing truthful strongly."

Tesla's earlier Robotaxi unveiling grounded to impressment investors, contempt a astonishment Robovan announcement and promises that unsupervised afloat autonomous driving would beryllium disposable successful California and Texas adjacent year. After nan unveiling, Tesla's banal fell 10%.

"With Tesla's Robotaxi Day passed, we judge nan attraction for Tesla astatine slightest for now shifts backmost to fundamentals," Barclays expert Dan Levy wrote successful a statement past week.

The institution reported better-than-expected gross margins — a cardinal metric — pinch a 19.8% summation compared to an estimate of 16.8%. It besides reported an adjusted net per stock of $0.72, good supra nan $0.60 that analysts expected.

The company's banal value jumped much than 10% successful after-hours trading. Overall, nan company's banal is down astir 15% this year.

Gene Munster, a managing partner astatine Deepwater Asset Management, told Business Insider successful an question and reply aft nan telephone that Tesla's 3rd 4th net was "kind of a uncommon 4th complete nan past six quarters wherever there's bully news crossed nan board." And nan banal summation shows conscionable really overmuch analysts attraction connected nan near-term and Tesla's automotive business, he said.

"Elon's talking astir autonomy, Cybercabs, robotaxi fleets," he said, "and analysts attraction astir cars and profitability."

Tesla said nan Cybertruck was profitable little than a twelvemonth aft its release. The institution besides said successful its net study that accumulation connected "more affordable models" remains connected way for nan first half of 2025.

Musk besides touted different aspects of Tesla's business, including its power products and afloat autonomous self-driving cars.

Mark Narayan, an RBC Capital Markets analyst, said successful a statement pursuing nan net telephone that nan quarterly results should "largely erase" nan losses Tesla faced aft nan Robotaxi event.

"If analysts are happy pinch nan fundamentals of nan car business, possibly they tin move their attraction to longer word ambitions for illustration autonomy (FSD/Robotaxi) and Optimus," he said.