Tesla (TSLA) is set to report its third-quarter earnings on Wednesday, October 22, and Wall Street is bracing for a sharp move. Based on options pricing, traders are expecting the stock to swing about 7.25% in either direction following the release of results. Interestingly, the potential swing is much larger than the EV giant’s long-term average post-earnings move of -1.24%, which reflects a modest decline. This suggests that investors are preparing for a more volatile reaction this time.
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The implied move is driven by uncertainty over EV demand and the company’s pricing strategy. Also, investors are watching for updates on Tesla’s Optimus robot business and full self-driving roadmap, as competition in this space continues to build.
Tesla stock has rallied over 34% in the past three months, fueled by a rebound in vehicle deliveries and renewed investor enthusiasm for its AI and robotics ventures. But with high expectations, any earnings miss or cautious guidance could trigger volatility.
What to Expect from TSLA’s Q3 Results?
According to analysts, Q3 revenue is expected to hit $26.33 billion, up 5% year-over-year. Meanwhile, analysts anticipate earnings per share (EPS) of $0.55, down 24% from the year-ago quarter.
While the company delivered 497,099 vehicles last quarter, beating expectations, it was likely boosted by buyers rushing to use the U.S. EV tax credit before it expired.
At the same time, Tesla’s margin concerns persist due to price cuts, higher input costs, and reduced regulatory credit revenue. Also, analysts are split on whether the company can maintain its edge amid rising competition in the EV space.
Importantly, Tesla’s AI and robotics ambitions, including its Robotaxi rollout and Optimus humanoid program, are taking center stage. Wedbush analyst Daniel Ives believes Q3 marked a potential turning point for Tesla. He sees it as the start of an “AI transformation” era driven by improvements in AI, autonomous driving, and robotics.
What Is the Prediction for Tesla Stock?
Turning to Wall Street, TSLA stock has a Hold consensus rating based on 14 Buys, 12 Holds, and nine Sells assigned in the last three months. At $347.27, the average Tesla price target implies a 22.4% downside risk. The stock has gained 84.3% over the past six months.
