Tesla posts revenue growth on record sales, but profit disappoints investors

Shares of Tesla (TSLA.O) fell nearly 4% in early Frankfurt trading on Thursday after the company’s quarterly earnings missed Wall Street expectations, despite higher revenue.

The weaker profit was mainly due to higher tariff and research expenses and a drop in income from regulatory credit sales.

Revenue, however, beat forecasts, driven by record quarterly electric vehicle sales as U.S. buyers rushed to take advantage of the $7,500 federal tax credit before it expired at the end of September. According to LSEG data, Tesla’s third-quarter revenue rose 4.2% year-on-year to $26.24 billion, while Reuters reported an actual figure of about $28.1 billion.

Tesla’s automotive gross margin excluding regulatory credits fell to 15.4% from 17% a year earlier, reflecting the impact of price cuts and the introduction of lower-cost vehicle trims.

In Italy, the government also supports electric vehicle adoption. In August 2025, authorities approved a subsidy program worth nearly €700 million, offering up to €10,000 for private buyers and €20,000 for small businesses that scrap older Euro 5 vehicles. The measure aims to revitalize the EV market and reduce carbon emissions.