Tesla Shares Fall 4% in Frankfurt After Earnings Miss Despite Record Sales
Tesla shares fell nearly 4% in early Frankfurt trading this morning after the electric vehicle maker reported quarterly earnings that missed Wall Street expectations, despite achieving record vehicle sales.
The company’s results were hit by a rush of electric vehicle purchases ahead of the expiry of a US tax credit, as well as declining margins due to lower car prices and rising investment costs.
Victoria Scholar, Head of Investment at interactive investor, said investors were unimpressed despite strong top-line growth:
“Tesla shares are under pressure in Frankfurt after investors shrugged off a 12% increase in third quarter revenue to $28.10 billion, beating analysts’ expectations. Instead, they were disappointed by its earnings per share, which hit 50 cents — below forecasts of 54 cents. Net income also plunged by 37% year-on-year to $1.37 billion, driven by lower electric vehicle prices.”
Scholar added that Tesla is also contending with higher costs from its AI and robotics investments and headwinds linked to the expiry of EV tax credits in the US.
The results highlight the profitability challenges Tesla faces amid intensifying competition in the global EV market and its pivot toward next-generation technologies.
Elon Musk Urges Tesla Investors to Approve $1 Trillion Pay Deal Ahead of Key Vote
Elon Musk has called on Tesla shareholders to back his $1 trillion pay package, defending the controversial proposal during the closing minutes of the company’s third-quarter earnings call overnight.
The compensation plan, which will be voted on next month, would grant Musk tranches of Tesla stock tied to a series of ambitious performance milestones — potentially making it one of the largest executive pay deals in corporate history.
Addressing investors, Musk insisted the proposal was not about personal wealth, but about ensuring he retains sufficient voting power and influence over Tesla’s long-term direction.
“The point is… there needs to be enough voting control to give a strong influence. But not so much that I can’t be fired if I go insane,” Musk said.
The remarks highlight the delicate balance of power between Musk and Tesla’s board as the company navigates an era of slowing margins, intense EV competition, and heavy investment in AI and robotics.
The proposed deal has drawn sharp criticism from governance experts and institutional investors, who argue it risks over-concentrating control in Musk’s hands. However, supporters claim it aligns his incentives with long-term shareholder value creation, given Tesla’s growth ambitions in autonomous driving, AI infrastructure, and robotics technology.
