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Tesla's Q3 revenues and margins fall, challenging its high valuation and growth outlook

Company Fundamentals
21 Oct 2026
Seeking Alpha
View Source
Bearish
Tesla's Q3 revenues and margins fall, challenging its high valuation and growth outlook

Tesla reported declining revenues and operating margins in Q3, with both its automobile and energy segments showing year-over-year revenue drops despite favorable market conditions like high fossil fuel prices. The operating margin was cut in half to 2.6%, while stock-based compensation doubled, further pressuring profitability and diluting shareholders. Tesla's valuation remains extremely high at around 400 times annualized Q3 earnings, which seems unjustified given the stagnating growth and falling margins. This report raises concerns about Tesla's growth narrative and profitability outlook going forward.

Tesla shares are trading at USD 379.37 on Pluang, showing a 1.51% gain in the last day. The stock's market cap stands at $1.48 trillion with a 52-week range between $298.16 and $489.88, as of Oct 22, 2026 04:41 WIB.

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