Tesla profit falls short despite record sales

STORY: :: TeslaTesla cashed in on a wave of electric car sales in the third quarter, but rising costs dragged earnings lower.Revenues beat Wall Street estimates, as the firm posted the highest quarterly sales of its electric vehicles due to U.S. buyers rushing to lock in a key tax credit ahead of its expiry last month.Tesla’s bottom line, however, failed to live up to analysts' expectations, in part due to tariff and research costs, as well as a drop in income from regulatory credits.Profit per share in the third quarter was 50 cents, below analysts' estimates of 55 cents. Shares dipped 4% in after-hours trading.:: File Tesla’s worth a whopping $1.45 trillion, thanks to investor hype around Elon Musk’s AI and robot plans. But for now, it’s still car sales that keep the company financially stable.EV demand is expected to slow now that tax credits have ended, and a hit from tariffs on auto parts cost the company over $400 million.To combat a demand drop, Tesla introduced lower-cost variants of Model Y and Model 3 vehicles, stripping out premium and basic features and lowering prices by about $5,000 to $5,500.Analysts warn the move will squeeze margins as thousands of dollars of cost cuts per vehicle may not fully compensate for lower selling prices.While car sales remain challenging, Elon Musk is all-in on robotaxis. He told investors Tesla’s self-driving cabs could hit the streets of Austin without safety drivers this year, and expand to ten metro areas by year-end.Tesla’s already running a limited robotaxi service in Austin, part of a bigger push to move beyond selling cars.

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