Tesla's Bitcoin Holdings Remain Unchanged
Electric vehicle manufacturer Tesla has maintained its significant holdings of Bitcoin for the fifth consecutive quarter. In its Q3 2023 results, released on October 18th, Tesla revealed that it still held $184 million worth of the digital asset as of September 30th. This represents a portion of the $1.5 billion worth of Bitcoin that Tesla initially purchased in March 2021. The latest results indicate that Tesla has neither bought nor sold any Bitcoin since the second quarter of 2022 when it sold off 75% of its holdings for $936 million.
Increasing Computing Power for AI Projects
While Tesla has made no changes to its Bitcoin holdings, the company has directed additional funds towards doubling its computing capacity for its artificial intelligence (AI) efforts. The Q3 results reveal that Tesla has more than doubled its computing power for AI projects, citing the need for a larger training data set and the transition of its humanoid robot Optimus to AI training rather than coded software. Tesla stated, "We have commissioned one of the world's largest supercomputers to accelerate the pace of our AI development, with compute capacity more than doubling compared to Q2."
Q3 Earnings and Profits Fall Short
Tesla's third-quarter earnings and profits failed to meet Wall Street estimates. The company reported total revenues of $23.35 billion, which represented an almost 9% increase from the previous year but fell short of Zacks Investment Research's estimate of $24.38 billion. Tesla also missed projected profits, with reported earnings per share (EPS) of $0.66 compared to Zack's estimate of $0.72 EPS.
Increased Operating Expenses and R&D Spending
Tesla's total third-quarter operating expenses reached $2.41 billion, marking a more than 13% increase from the previous quarter and over a 42.5% increase from the prior year. The company's research and development expenses were $1.16 billion in the quarter, a significant 58% jump from the previous year. Tesla attributed these increases to its ongoing projects, including the Cybertruck, AI, and other R&D initiatives.
Tesla's stock price dropped nearly 4.8% on the day, closing at $242.68. In after-hours trading, the stock fell a further 4.25% to $232.37, according to Google Finance data.
