Tesla Q3 2026 net profit falls 43 percent

Tesla reported a 43 percent decline in net profit for the third quarter of 2026, with earnings dropping to $787 million. The automaker disclosed these financial results alongside revenue figures that show a mixed performance across its business segments.

Total revenue reached $28 billion, remaining almost unchanged from the same period in 2025. Within that total, automotive revenue decreased by 3 percent year over year to $20.6 billion. A more significant contraction occurred in the solar and storage battery division, where revenue fell 16 percent to $2.9 billion, reversing a previous growth trend. In contrast, services and other revenues, which include parts sales and Supercharger usage, increased by one-third to $4.6 billion.

The drop in profitability was driven largely by rising costs. Operating expenses surged 39 percent to $4.8 billion, compressing the operating margin to 2.6 percent. This is a sharp decline from the 5.8 percent margin Tesla recorded in the third quarter of 2025. Additionally, capital expenditures more than doubled, rising 110 percent to $4.7 billion.

These increased outlays contributed to a 62 percent decrease in free cash flow, which stood at $1.5 billion for the quarter. The financial report follows Tesla's earlier October announcement of sales and deliveries for the three-month period, which indicated fewer vehicle sales than in 2025 but still exceeded analyst projections.