All eyes were on Tesla’s quarterly results, released after the closing bell on Wall Street on Wednesday, October 21, 2026.

Tesla stock falls more than 3% after the earnings release

Tesla shares reacted to the numbers by dropping more than 3% in after-hours trading, to $373.65, after closing the prior session at $386.47, up 3.41%.

The third-quarter results of the electric-vehicle group founded and run by Elon Musk beat analysts’ expectations, but revenue from the automotive division declined — and that is what the TSLA stock is pricing in.

Group net income fell 29% to $787 million, or 22 cents per share, from $1.11 billion, or 32 cents per share, in the same period last year.

On an adjusted basis, earnings per share came in at 48 cents, ahead of the 43 cents analysts had expected.

Tesla’s third-quarter group revenue totaled $28.05 billion, above the $27.9 billion forecast but slightly below the $28.24 billion posted in the third quarter of 2025.

The core automotive business stood out, with revenue down 3% year over year to $20.56 billion.

The energy segment also contracted, with revenue falling 16% to $2.88 billion.

Partly offsetting those declines was growth in services and other activities, where revenue rose 33% year over year to $4.61 billion.

Profitability squeezed by a surge in humanoid robot spending

The deterioration in profitability reflects a jump in spending on the Optimus humanoid robots and on other initiatives tied to artificial intelligence (AI).

Capital expenditures (CapEx) more than doubled from a year earlier, reaching $3.73 billion. As a result, free cash flow — the cash left over after investments — slid 62% year over year to $1.53 billion.

Tesla attributed the weakness in automotive revenue and profitability to lower average selling prices for its vehicles during the quarter and to battery supply constraints, which kept the company from building enough cars to clear its order backlog.

On the analyst call discussing the results, however, Elon Musk also said that car sales in Canada, Japan, Taiwan and Australia set new records during the quarter.

A Tesla-SpaceX merger? Musk: «I feel like I’m tap dancing in a minefield»

Tesla’s earnings came out a day after Musk, speaking on SpaceX’s own results call, said a merger between his two companies would be a «good idea», noting that the boards of both companies had set up special committees to discuss a possible combination.

Asked on Wednesday’s call about a hypothetical merger between the two giants, Musk said: «I feel like I’m tap dancing in a minefield», adding: «I think I said yesterday everything there was to say» about a possible integration of Tesla and SpaceX, both of which he founded and runs.

Full Self-Driving subscriptions keep climbing

Among the bright spots was growth in subscriptions to Tesla’s autonomous driving service.

The carmaker said the adoption rate of its FSD (Full Self-Driving Supervised) system — the partially automated driving package offered in the United States for $99 a month — rose 20 percentage points from the second quarter, on the back of active subscriptions that climbed 67% year over year to 1.74 million.

The company said it believes «FSD is supporting demand in the markets where it is available, and we continue to work with regulators to obtain approval in other markets».

Ashok Elluswamy, Tesla’s vice president of Autopilot, added that the company expects to give some customer vehicles access to the future FSD (Unsupervised) system, designed to operate without driver supervision, around the second quarter of next year — that is, in 2027.

Cybercab testing and Musk’s robotaxi ambitions

Tesla is also testing the Cybercab, a bronze-colored two-seater designed to be used as a robotaxi, which is not yet available for purchase by private buyers.

On the call, Musk said that «the vast majority of Cybercabs will essentially be owned by Tesla and used to provide ride-hailing services», while chief financial officer Vaibhav Taneja said Tesla plans to extend the Cybercab service to cities beyond Austin, Texas, by the end of this year, with close attention to operating costs including maintenance, charging and vehicle cleaning.

Musk said the driverless robotaxi fleet will start contributing to Tesla’s financial results in 2027.

According to data from the Texas Department of Motor Vehicles, the fleet currently comprises 362 Model Y Robotaxis and 449 Cybercabs authorized to operate without a driver in the state.

Musk went further, offering a particularly ambitious forecast about the future of autonomous mobility. In his view, absent restrictive moves by regulators and protectionist measures, Tesla will end up handling most of the passenger miles traveled worldwide, in every country where it is allowed to operate freely:

«Tesla will end up handling the majority of passenger miles traveled in the world, in all the countries where it is allowed to operate freely».

Editor’s note

This article was originally published in Italian on money.it by Laura Naka Antonelli on October 22, 2026 as «Trimestrale Tesla, azioni giù post annuncio utili e ricavi. Musk su SpaceX: “Mi sembra di ballare il tip tap in un campo minato”». It has been translated and adapted for an international audience by the Money.it International desk.