Tesla ETF Skyrockets on Strong Q3 Earnings
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Shares of Tesla surged as much as 17% on Thursday after the company issued strong guidance for 2025. The Direxion Daily TSLA Bull 2X Shares (TSLL)—a leveraged ETF that delivers twice the daily return of Tesla stock—rocketed 34% higher.
The world’s largest electric vehicle maker reported better-than-expected earnings for the third quarter. EPS came in at $0.72 versus the $0.63 that analysts were expecting.
Profitability was boosted by strong margins, which offset slightly lower-than-expected revenues.
Automotive gross margin excluding regulatory credits rose to 17.1% from 14.6% in the previous quarter. Sales of $25.2 billion for Q3 were a tad below the $25.4 billion expected, but they were up 7.8% from a year ago—an encouraging sign for a company that had showed slowing revenue growth for much of the past year.
Tesla had reported year-over-year revenue growth of 2.3% in in Q2 and an 8.7% revenue decline in Q1.
Tesla ETF Soars on Strong Q3 Earnings
The turnaround in the company’s business is expected to pick up steam into next year. CEO Elon Musk predicted that vehicle sales could jump 20% to 30% in 2025. He also offered a plethora of bullish commentary on the company’s autonomous vehicle and robotics initiatives.
Musk said that the firm could begin offering driverless rides through an app in Tesla’s existing car models as soon as next year in California and Texas.
The more futuristic Cybercab—which doesn’t have a steering wheel, and which the company debuted at a highly-anticipated event earlier in October—won’t be in production until 2026, Musk said at the time.
The timetable turned off investors, who were hoping for a quicker launch. Shares of Tesla and TSLL dropped 9% and 18%, respectively, after the event.
However, with today’s post-earnings move, both the stock and ETF have more than recovered those losses.