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Tesla and Meta head into earnings with profit and AI spending under scrutiny
Tesla and Meta report third-quarter earnings after today's closing bell, putting two very different AI bets in front of shareholders on the same night. For Elon Musk, the question is how much Tesla's car business can fund. For Mark Zuckerberg, it is how quickly rising revenue can keep up with spending.
The stocks head into October 21 from opposite directions. Tesla finished Tuesday at $373.71, up 1.54%, while Meta closed at $694.25, down 1.59%. Those are regular-session moves, before either company's results.
Tesla has already disclosed 486,532 vehicle deliveries and 13.7 gigawatt-hours of energy storage deployments for the quarter. Tonight brings the missing pieces: what it earned on those sales, how much cash came in and how much went back out. Selling cars and making money from them are separate questions, particularly when investors are also paying for Musk's ambitions in autonomy and robotics.
There is another question hanging over the call. As Apex reported during yesterday's SpaceX earnings coverage, Musk said independent committees at the two companies were discussing a possible merger. No transaction terms had been agreed. Tesla's own call gives shareholders another opportunity to hear how management addresses that discussion.
Meta previously forecast third-quarter revenue of $61-64 billion and full-year capital spending, including finance-lease principal payments, of $130-145 billion. That spending range makes the cash-flow figures especially worth watching. In the second quarter, Meta generated $31.86 billion in operating cash flow but reported just $784 million in free cash flow after capital spending.
Zuckerberg made his case in July:
"AI is accelerating our core business today, powering our next generation of products, and opening the door to entirely new enterprise opportunities."
Tonight's report will give investors another quarter of revenue, costs and margins to judge that claim against. Any change to the spending outlook could matter well beyond the headline profit number.
The schedule puts Meta's call at 20:30 UTC and Tesla's at 21:30 UTC. Both companies plan to release their financial results after the market closes, ahead of their calls.