Tesla's stock experienced a notable rebound in after-hours trading on January 29th, despite the company missing Wall Street's earnings estimates for the fourth quarter of 2024. The initial drop in share price was attributed to weaker-than-expected sales and revenue figures, with Tesla reporting $25.7 billion in revenue, falling short of the anticipated $27.26 billion. The company's net income of $2.5 billion also came in below forecasts, although it marked a 3% increase from the previous year. The automotive revenue saw an 8% decline, largely due to reduced average selling prices across its Model 3, Y, S, and X lines. However, Tesla's announcement of plans to introduce more affordable models and the upcoming rollout of its Cybercab model in 2026 seemed to have reassured investors, contributing to the stock's recovery.
The company's profit margin, excluding regulatory credits, was reported at 13.6%, which was tighter than the 16.2% margin analysts had expected. Despite these challenges, Tesla's shares managed to rise as investors focused on the company's future growth prospects, including its commitment to returning to sales growth in 2025 and the potential benefits from its autonomy efforts. CEO Elon Musk's involvement with the Trump administration and the potential regulatory changes also played a role in shaping investor sentiment, as these could impact Tesla's competitive landscape and revenue from emission regulation credits.
Tesla's shares closed at $389.1, down 2.26% from the previous close of $398.09, but rose 2.8% in after-hours trading to reach $400.