Tesla predicts slight growth in vehicle deliveries

Tesla said it expects to achieve slight growth in vehicle deliveries this year and reported a third-quarter profit that handily beat Wall Street estimates as its costs of making a car fell to a record low.

Tesla shares surged 7% after hours, adding nearly $50 billion in market value, as investors cheered what looked like improvements in Tesla's core business of selling cars. The stock had closed down 2%.

CEO Elon Musk has been focused on transforming Tesla from a pure-play EV maker to a leading force in autonomous driving and artificial intelligence. But the company's robotaxi event earlier this month left investors desiring more details on how the company plans to do so.

Investors slammed shares the next day, punishing Tesla for the conspicuous absence of a concrete business plan. This month Tesla's stock has tumbled nearly 20% and the report card and forecast will offer shareholders some respite.

"Despite sustained macroeconomic headwinds and others pulling back on EV investments, we remain focused on expanding our vehicle and energy product lineup, reducing costs and making critical investments in AI projects and production capacity," Tesla said in a statement.

The company said it delivered growth in vehicle deliveries in the third quarter, resulting in record volumes. It also recognized its second-highest quarter of regulatory credit revenues.

Prices of raw materials used to make EV batteries have been falling and Tesla has said its costs will decline as a result this year, with the effect diminishing over time.

Its third-quarter profit margin from vehicle sales, excluding regulatory credits, grew to 17.05% from 14.6% in the prior three-month period, according to calculations.