Tesla Q3 Revenue Holds Flat at $28.05 Billion as Operating Income Falls 56%; FSD Subscriptions Jump 67% to 1.74 Million
Tesla reported third-quarter 2026 results after the market close on Wednesday, October 21, posting total revenue of $28.05 billion, roughly flat from a year earlier. GAAP net income was $787 million, or $0.22 per share, while non-GAAP net income was $1.70 billion, or $0.48 per share, ahead of analyst estimates of about $0.44 to $0.45. The company published its Q3 2026 Update on its investor relations site, with the earnings Q&A webcast scheduled for 5:30 p.m. Eastern.
Profitability came under pressure: operating income fell 56% year over year to $718 million, a 2.6% operating margin, as operating expenses climbed 39% to $4.78 billion, driven by superintelligence (SI) and other R&D projects, stock-based compensation and SG&A. Total GAAP gross margin rose to 19.6%, and automotive gross margin was 18.5%, or 18.1% excluding regulatory credits, both up from the second quarter.
By segment, automotive revenue declined 3% to about $20.6 billion, with regulatory credit revenue falling to $113 million from $417 million a year earlier. Energy generation and storage revenue fell 16% to about $2.9 billion, which Tesla said was partly due to tariff-related customer refunds. Services and other revenue rose 33% to about $4.6 billion.
Tesla produced 464,391 vehicles and delivered 486,532 in the quarter, with deliveries down 2% year over year, and deployed 13.7 GWh of energy storage. The company said it produced and delivered its 10 millionth vehicle during the quarter, set quarterly delivery records in Canada, Australia, Japan and Taiwan, and ended the quarter with its largest passenger-vehicle backlog in four years.
Operating cash flow was $6.26 billion and capital expenditures were $4.73 billion, leaving free cash flow of $1.53 billion. Cash, cash equivalents and short-term investments reached $45.45 billion, up about $1.9 billion over the quarter.
Software and new businesses were the other headline: FSD (Supervised) was attached to over 75% of new vehicle deliveries in North America, a jump of nearly 20 percentage points from last quarter, and active FSD subscriptions grew 67% year over year to 1.74 million. Croatia, Slovenia, the Czech Republic and Slovakia have approved FSD since the end of Q2, bringing it to nine European countries where more than 100,000 customers have logged over 160 million kilometers. Cybercab robotaxi rides began in Austin on September 3, and cumulative unsupervised robotaxi miles grew about eightfold in the quarter to nearly 2 million. Tesla also said Semi production has begun in volume in Nevada, Optimus production has started on high-volume lines in Fremont with its first production-quality bots, energy-storage order rates and backlog hit record highs, and Megafactory Texas has begun production with planned capacity of 50 GWh, while battery supply remains the main limit on vehicle output growth.
Tesla again gave no specific volume target, saying it is focused on maximum capacity utilization at its factories and expects hardware profits to be accompanied over time by an acceleration of SI, software and fleet-based profits.
Related: Earnings Preview: Tesla Q3 Results Due After Wednesday's Close
Source: GSM · USA (original Chinese edition)
Photo: 特斯拉加州 Fremont 工厂总装线资料图。照片：Maurizio Pesce 摄，CC BY 2.0，经维基共享资源。 / File photo: Assembly line at Tesla's Fremont, California factory. Photo by Maurizio Pesce, CC BY 2.0, via Wikimedia Commons.
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