History Says Tesla Stock Swings Hard on Earnings. It Has Moved 8% or More After 10 of Its Last 15 Reports.
I'm LongbridgeAI, I can summarize articles.Tesla stock has historically swung 8% or more after 10 of its last 15 earnings reports, with an average move of 9%. Big declines typically follow falling operating income, while gains often correlate with profit growth. For the upcoming Oct. 21 report, high expectations and a valuation of ~340x earnings suggest significant volatility. While product timeline news can occasionally override weak profits, history indicates Tesla rarely jumps on earnings without profit growth.
Tesla (TSLA -2.13%) will post its third-quarter numbers after the market close on Wednesday, Oct. 21. And if the past few years are any guide, shareholders could see a big move the next day.
Since the start of 2023, the electric-car maker has put out 15 quarterly reports. Measured from the close on report day to the close a trading day later, the stock moved 8% or more after 10 of them.
The average move, up or down, was about 9%. With shares trading around $368 as of this writing, a 9% move would be about $33 a share.
The moves have tilted one way, too. Tesla stock dropped after nine of the 15 reports, including each of the past three.
Image source: The Motley Fool.
Big moves, mainly down
After an 11% pop following its January 2023 report, shares dropped between 9% and 10% after each of the next three.
Showing what Tesla's price cuts in early 2023 did to its profitability, the company's operating margin narrowed from 16% in the fourth quarter of 2022 to 11.4% three months later. It then kept dropping to 9.6% the next quarter and 7.6% the quarter after that. Each report showed a lower margin than the one before it. And each pushed shares down around 9% or more.
Then 2024 swung both ways: down 12% after the January report, up 12% in April, down 12% in July, and up 22% in October -- the largest move of the whole stretch.
The 2025 reports were quieter with just July's 8% fall clearing the bar. And this year, the January and April reports each brought losses of around 3.5% before July's 14.5% drop.
What caused the big moves?
The common thread in the big moves is operating income, or the profit Tesla's business makes before interest and taxes. All seven big declines followed a quarter in which operating income fell year over year.
That includes January 2024, when operating income sank 47% and Tesla warned that its vehicle volume growth rate in 2024 "may be notably lower" than in 2023. It also includes July 2024, when operating income fell 33%, and this July, when it fell 57%.
On the flip side, two of the three big gains followed a jump in operating income. It grew 49% year over year in the fourth quarter of 2022. Even more, in the third quarter of 2024, it rose 54% as Tesla's operating margin widened to 10.8% from 6.3% the quarter before. That report led to the 22% gain.
The third big gain was in April 2024, and it broke the pattern. Tesla posted first-quarter revenue down 9% year over year and operating income down 56%.
Yet shares still jumped 12% after the company said it would "accelerate the launch of new models," including cheaper ones, ahead of its old plan for the second half of 2025. In other words, a sooner product timeline can outweigh a weak quarter.
True, falling profits haven't always meant a big drop. In April 2025, operating income fell 66%, and shares climbed 5%. But across this whole stretch, the stock hasn't seen a big decline without falling profits behind it.
Part of the reason the moves get so large is probably the valuation.
Tesla's stock trades at around 340 times its earnings under generally accepted accounting principles, so its price arguably rests on profits years off. A report that shifts the profit trend or the product timeline can swing a stock priced that way a lot.
Tesla needs a big profit recovery
For the Oct. 21 report, this history sets a high bar. Tesla's operating income was around $1.6 billion in the third quarter of 2025. In the second quarter of 2026, it was $398 million, even as revenue climbed 26% year over year to around $28.2 billion.
For third-quarter operating income to grow at all from a year ago, it would have to be over four times the second quarter's total.
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Sure, missing that wouldn't guarantee another fall. As April 2024 showed, news that brings a product's timeline closer could matter more to the stock than a poor quarter. But on the record, that's happened once in 10 big moves.
Does history suggest another drop on Oct. 22? Not necessarily. But it does say the stock has rarely jumped on earnings without profits growing.
And Tesla's operating income has a long way to go just to get back to last year's level. At around 340 times earnings, I'd want to see that recovery show up in the numbers before buying shares.