Tesla’s net income attributable to common stockholders fell 42.7% year-on-year to $787m in the third quarter of 2026, from $1.37bn a year ago.

Basic earnings per share declined 44.2% to $0.24 from $0.43, while diluted earnings per share fell 43.6% to $0.22 from $0.39.

The decline in earnings came as total operating expenses increased 39.2% to $4.78bn from $3.43bn. Research and development spending rose 69.4% to $2.76bn.

Total revenue was broadly unchanged at $28.05bn, compared with $28.10bn a year earlier.

Income from operations decreased 55.8% to $718m, compared with $1.62bn in the same quarter of 2025.

Total automotive revenue fell 3% to $20.56bn from $21.21bn. Automotive sales revenue decreased 1.3% to $20.09bn, while automotive leasing revenue declined 17.7% to $353m.

Revenue from automotive regulatory credits dropped 72.9% to $113m, compared with $417m in Q3 2025.

Energy generation and storage revenue decreased 15.6% to $2.88bn from $3.42bn. Services and other revenue increased 32.5% to $4.61bn from $3.48bn.

Tesla’s total cost of revenues declined 2.1% to $22.55bn from $23.04bn. Automotive costs decreased 4.8% to $16.75bn, while energy generation and storage costs fell 17.7% to $1.93bn.

Gross profit consequently increased 8.7% to $5.49bn from $5.05bn.

The company reported no restructuring and other costs in Q3 2026, compared with $238m in the prior-year quarter.

Income before income taxes declined 51.2% to $956m from $1.96bn. Interest income rose 1.4% to $445m, while interest expense increased 18.4% to $90m.

Tesla reported net other expense of $117m, compared with net other expense of $28m in Q3 2025.

Looking ahead, Tesla said its priorities would include maximising factory utilisation, maintaining liquidity, reducing manufacturing and operating costs, and expanding its software, fleet and infrastructure activities.

Tesla said it was focused on maximising capacity utilisation at its factories. Deliveries and deployments would depend on aggregate demand, supply chain readiness and decisions over the allocation of production between customer sales and its owned and operated fleet.

Tesla also said it continued to pursue reductions in manufacturing and operating costs. Over time, the company expects hardware-related profits to be accompanied by faster growth in SI, software and fleet-based profits.