Tesla's car business back on growth path as deliveries beat forecasts

Tesla is on course to end two straight years of falling sales after its third-quarter deliveries beat Wall Street estimates on Friday, with a rebound in Europe giving the automaker ‌a way back to growth without US tax incentives. Shares of the Austin, Texas-based company, which have lost about a fifth of their value so far this year, rose more than 5% in early trading.

The figures suggest Tesla's core car business may be regaining momentum even as investors increasingly look past quarterly deliveries to CEO Elon Musk's push ‌into AI, robotaxis and humanoid robots. The EV maker's roughly $1.40 trillion valuation depends heavily on those long-term ambitions, even though vehicle sales are still its largest source ‌of revenue.

"The strong numbers put Tesla on track for full-year deliveries growth following two years of declines. I point to FSD (Full Self-Driving) as being a differentiator that drives consumers to choose Tesla over other autos," Morningstar senior equity analyst Seth Goldstein said. Tesla needs 311,448 more deliveries to match last year's total, fewer than it has delivered in any quarter since mid-2022.

In the United States, the Musk-led ⁠firm's sales ​were expected to fall from a record ⁠third quarter last year, after a $7,500 federal tax credit for EV buyers expired at the end of September 2025. Tesla delivered 486,532 vehicles in the July-September period, compared with analysts' average estimate of ⁠456,896 vehicles, according to data compiled by Visible Alpha.

Demand looked strong going into the quarter as finance chief Vaibhav Taneja said in July Tesla "exited Q2 with our largest order backlog ​since 2023." Unlike earlier this year, analysts have raised their full-year forecasts - now expecting 1.82 million deliveries in 2026, up from 1.65 million in the June ⁠consensus.

Also on Friday, smaller rival Rivian beat estimates for third-quarter deliveries and reaffirmed its annual deliveries forecast. Tesla is set to report quarterly results on October 21 after markets close. EUROPE RECOVERY

After last year's slump ⁠in ​Europe, caused partly by backlash against Musk's politics and partly by cheaper Chinese rivals, EU registrations rose by about two-thirds in the January-August period from a year earlier, according to the European Automobile Manufacturers' Association. Tesla's European sales recovery gathered pace in the third quarter, with strong registration growth in France and Denmark and ⁠broader gains in September, helped by government incentives, easier year-ago comparisons and rising consumer interest in EVs.

Analysts expect the slow rollout of the company's Full Self-Driving ⁠software in Europe to help sales further ⁠as FSD is now approved in eight countries. Its robotaxi service fleet is smaller than Alphabet's Waymo, which runs commercial services in several US cities.

Tesla's robotaxi service now runs without a safety supervisor inside the car in Texas and Florida. Last ‌month, the company added its ‌purpose-built Cybercab to its existing robotaxi service in Austin.