Tesla Results | How to Deploy Hidden Concerns After Innovative Revenue Highs?

2025 Q3 Tesla Results

Electric car giants $Tesla(TSLA.US)$ The recently announced Q3 results can be a great addition to the second half! Operating revenue of $28.1 billion is at a new all-time high, up 12% year-on-year, surpassing market expectations. On the back of the bright numbers, profit performance did not look as expected, with adjusted EPS of $0.50 per share, below expectations of $0.54 (see below), after the news broke the share price fell by almost 4%.

Profitability Slips Pay Plan Add Variables

After the second round of results, the worst thing to worry about is that gross margins continue to be under pressure! The gross margin in the third quarter was 18% higher than expected, compared with a 20% decline year-on-year (see below). The operating profit margin decreased to 5.8%, reflecting the increase in cost, and the end of discount promotions and tax incentives weighed heavily on the profit margin. Simply put, Tesla is already selling a lot of cars for less money!

The Shareholder Ballot, which will be held until November 6, is the focus of the short-term market. Tesla CEO to discuss Elon Musk's new salary plan, totaling $975 billion to $1 billion, is the largest corporate pay plan in history. The solution could only be fully realized if Tesla reached a Market Cap of 8.5 million USD and a multi-purpose operation target (selling 12 million Cars and 1 million machines, etc.) within the next decade. Elon Musk has stated that the super-high salary solution does not come through employment. It is not clear what the outcome of this event is, and how the result of this event, on average, causes the share price movement.

Tesla Results | Top 3 Future Investment Highlights

1. Delivery Data Rebound

Tesla delivered 0.497 million vehicles in the third quarter, up 7.4% year on year, exceeding expectations, reversing a decline in the first half of the year and driving the share price higher after the data came out. The biggest gainer was the Chinese market, where Tesla's sales in Greater China increased by 31% in the period, mainly benefiting from the Mainland's “old to new” subsidy policy, which made the overall delivery figures bright. We believe that future delivery data remains the focus of the market.

2. Breakthrough of Productivity Layout

China's production base enters a new phase, Shanghai super plant will increase from 0.25 million vehicles per year in 2020 to nearly 1 million vehicles per year in 2024, after completion in 2025, annual production could exceed 2 million vehicles per year, becoming the world's largest electric car production base, Tesla's global production capacity The case is expected to be close to 65%. It is hoped that the efficiency of this production model will improve the group's future profitability.

3. AI and FSD Technology Advantage

The “Optimus” humanoid robot is expected to go into mass production next year, and Elon Musk believes Optimus could eventually account for 80% of Tesla's value, with partial results pending further release.

According to robotaxi, the US is still the largest market other than China. Considering that the price per kilometer in China is comparable to that of the United States. Bullish robotaxi is growing up in the United States, so do not believe that robotaxi has much business value in the United States. Currently, only Tesla has been following Waymo's development of Robotaxis in the United States, but Waymo will commercialize Tesla early. The advantage of Tesla is that with a vertically integrated production system, it is self-controlled from manufacturing to software and is not used by external Car Manufacturers. IT CAN BE SEEN THAT FSD'S FULLY AUTOMATED DRIVING TECHNOLOGY CONTINUES TO EVOLVE, WITH COST-CONTROL POWER, WHICH IS GOOD FOR THE FUTURE PERFORMANCE AND SHARE PRICE PERFORMANCE.

Investment Deployment Recommendations:

First resistance level: $470

Key Resistance Level: $488

Support Level: $400

Key Support Position: $332

Taking into account the Group's underlying profit pressures, plus the November stock market events, adding to short-term volatility in the share price, investor or reference options strategy recommendations:

1. Shortline event-based strategy

• strategy: Buy a Long Straddle or a Wide Difference (Strangle)

For investors who focus on volatility rather than single-sided markets, they can enter before the voting event, close positions on the day of the announcement or the day after the announcement.

• Risk: Investors are required to assume the risk of loss of mutual interest in the absence of waves and time limits. This suggests controlling costs by shifting to an event-based strategy.

2. Conservative Deployment

• Strategy: Sell Cash-Secured Put, CSP

If you have a good look at the Tesla long line fundamentals, you can choose a maturity date after a period of time. Strike price is set at the Technical Resistance level (for example, the $400 level, to take high options during the high volatility. Short-term stock price reversals are available at lower prices.

• Risks: The market reacts to Musk's salary solution, the share price drops sharply, and the Strike price requires Buy Tesla Stock Stocks.

3. Put Down Defense

• Strategy: Buy a Short Term Protective Put, Strike price can be set at the current price of 7-10% to lock down downside risk directly until the end of the November betting event

•Risk: The maximum cost is the right to pay for a long a put option. If there is no fall in the share price, this royalty is a mere cost.

Tesla's Latest Target Price Is Up to $600

Tesla's traditional car sales business is under pressure, while new businesses such as AIFSD and mechanics are expected. THE CURRENT SALES RATE (PS) IS AROUND 16K, HAS NOT BEEN HIGHER THAN THE LEVEL IN THE PAST 5 YEARS. VALUE CALCULATION IS REASONABLE (SEE BELOW).

Analyst Ratings for the reference beef app, half suggest Buy and Hold Tesla, with an average Target Price of $382, and the best beef is $600 (see below).

Many Institutions in the Market Reiterated Tesla as One of the Must-Have Stocks. The long line is Bullish that Tesla is not going to encourage investors who want to grow economically, believe that each stock price realignment or split is a good time to collect the stock.

Futu Securities Senior Analyst Wen-hui

(The author is a licensee of the Securities and Exchange Commission and its affiliates do not have any financial interest in the proposed issuer of shares)