Tesla Inc. (NASDAQ:TSLA) stock declined 2.89% before the bell on Thursday, as the EV maker missed Wall Street’s quarterly earnings per share (EPS) expectations.

Fourth Consecutive EPS Miss

Tesla reported third-quarter revenues of $28.095 billion, marking a 12% year-over-year increase, and surpassing the Street’s consensus estimate of $26.239 billion.

However, EPS of 50 cents came in below the Street’s estimate of 54 cents-- marking the fourth consecutive miss on expectations. This was in part due to tariff and research costs, as well as a drop in income from regulatory credits that are expected to continue to fade away with recent legislation passed by the Trump administration.

Operating income plummeted 40% year-over-year to $1.6 billion, with an operating margin of 5.8%.

Mixed Wall Street Reactions

Gene Munster, managing partner at Deepwater Asset Management, highlighted Tesla’s balance sheet strength, noting that its cash and liquidity increased by $4 billion during the quarter to $41 billion. Meanwhile, Wedbush analyst Dan Ives called this the company's "golden chapter."

However, concerns have been raised about Tesla’s strategic focus. Ross Gerber, co-founder of investment firm Gerber Kawasaki, believes that Tesla’s shift away from EVs could be a strategic error for the company. Despite this, his firm still holds over “$80 million” in Tesla stock for clients.

Gary Black, managing director of Future Fund LLC, also expressed concerns about Tesla’s future. He stated that CEO Elon Musk‘s comments about the future did little to boost investor confidence following the mixed Q3 earnings report.

Key Metrics Denote Strength

Tesla holds a momentum rating of 92.39%, a growth rating of 76.06% and a quality rating of 73.72% according to Benzinga's Proprietary Edge Rankings.

The Benzinga Growth metric evaluates a stock’s historical earnings and revenue expansion across multiple timeframes, prioritizing both long-term trends and recent performance. Check the detailed report here.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.