Tesla reports 43% profit decline amid higher AI and robotics spending
Optimus manufacturing has started in California, while Tesla is targeting initial Cybercab deliveries to customers by the end of 2026.
Tesla reported US$787 million in third-quarter net income, down 43% from US$1.37 billion a year earlier, alongside increased investment in AI, robotics and autonomous driving. Revenue remained unchanged at US$28.05 billion. CNBC reported an after-hours decline of more than 3% in Tesla shares.
The company’s operating expenses reached US$4.78 billion, up 39%, while capital spending more than doubled, reaching US$4.73 billion. Operating income declined 56%, to US$718 million, with an operating margin of 2.6%. Chief financial officer Vaibhav Taneja said spending would continue to rise before the new products reach the market.
Automotive operations generated US$20.56 billion in revenue, a 3% decline. Energy revenue dropped 16%, to US$2.88 billion, partly because of tariff-related customer refunds, Tesla said. Services and other revenue reached US$4.61 billion, up 33%, supported by increased driver-assistance subscriptions.
Tesla also announced that high-volume manufacturing lines at its Fremont, California, site had begun producing Optimus humanoid robots. Musk cautioned that production remained at an early stage, with design changes still needed. He estimated that weekly output of 20,000 robots would probably require at least a year, and possibly longer.
Engineering vice president Lars Moravy said Tesla was seeking a small initial rollout of Cybercab customer deliveries before 2026 ends. Production so far has supplied Tesla’s own robotaxi fleet. The US vehicle safety regulator is investigating whether the Cybercab meets federal safety standards.
Executives placed the introduction of unsupervised driving for customer vehicles around the second quarter of 2027. Tesla’s existing Full Self-Driving software continues to require driver oversight.
