24/10/2025

FRIDAY | OCT 24, 2025

BIZ & FINANCE 17 Tesla profit slides despite record sales

SAN FRANCISCO: Tesla reported record third-quarter revenue that beat Wall Street estimates on Wednesday, driven by the highest quarterly sales of its electric vehicles as US buyers rushed to lock in a key tax credit ahead of its expiry last month. However, Tesla’s profit failed to live up to analysts’ expectations, in part due to tariff and research costs, as well as a drop in income from regulatory credits that are expected to continue to fade away with recent legislation passed by the Trump administration. Tesla’s US$1.45 trillion valuation largely reflects investor bets on CEO Elon Musk’s pivot to robotics and AI, but vehicle sales remain key to the financial stability of the company while those products are being developed. o Operating expenses jump 50%, no full-year 2025 forecast

its self-driving “robotaxi” service in Austin, Texas earlier this year. Musk also said he expected robotaxis to operate without safety drivers in large parts of Austin this year and that robotaxis would be operating in eight to ten metropolitan areas by the end of the year as well. In July, he had predicted Tesla robotaxis to serve about half the U.S. population by year end. Wall Street expects Tesla’s deliveries in 2025 to fall 8.5% due to the expiry of the tax credit, reliance on older models and rising competition. Musk’s embrace of right-wing politics has also alienated some potential buyers. But many investors are deeply confident in Musk. Nancy Tengler, CEO and chief investment officer of Tesla shareholder Laffer Tengler Investments, said she was bullish on the next three to five years. “I’m less concerned about the next quarter,” she said. “It’s messy, it’s hard, it’s trial-and error, it’s try again. But this is a CEO who is determined. And I think what we’ve seen historically is that he will get it done.” – Reuters Nokia earnings beat forecasts on optical, cloud demand ESPOO: Nokia reported third-quarter profit which was ahead of market expectations yesterday, driven by strong optical and cloud demand, including AI-focused data centre sales following its Infinera acquisition. The company’s shares were up 10.6% to €5.2 by 0717GMT (3.17pm in Malaysia), their highest in over three years, adding €3 billion to the company’s €30 billion market value. Comparable operating profit in the quarter through September reached €435 million (RM2.1 billion). Analysts polled by LSEG expected the same metric to reach €342 million. US tariffs, a market slowdown and a weaker dollar had weighed on Nokia’s business this year, prompting it to issue a profit warning in July. The company had lost ground in the North American telecoms market as U.S. carrier AT&T phases out Nokia’s 5G contract in favour of Nordic rival Ericsson, which won a US$14 billion deal in 2023. However, quarterly group net sales rose 12% to €4.83 billion, above the €4.6 billion forecast, helped by strong growth in Optical Networks and cloud services. Nokia said artificial intelligence and cloud customers accounted for 6% of group net sales and 14% of network infrastructure sales, with optical networks up 19% on a constant currency basis. Mobile networks remain Nokia’s core business, but the company has been investing in AI, including its recent acquisition of US optical networking firm Infinera. “AI and data centre demand continues to be robust. In fact, it continues to accelerate from our perspective” chief executive Justin Hotard said in a call with reporters. The Finnish company expects annual operating profit between €1.7 billion and €2.2 billions, a slight upgrade to the previous range of up to €2.1 billion. It had previously said the second half of 2025 would be stronger than the first. The slight revision is linked to a change in how it reports venture fund results after Nokia said it will scale down its passive investments. – Reuters

billion for the third quarter ended Sept 30, compared with analysts’ average estimate of US$26.37 billion, according to data compiled by LSEG. Profit per share in the third quarter was 50 cents, below analysts’ estimates of 55 cents. Automotive regulatory credits, once a key driver of profit, fell to US$417 million in the quarter from US$739 million a year ago and US$435 million in the second quarter. Tesla reported gross margin of 18%, compared with estimates of 17.5%. Its closely watched automotive gross margin, excluding regulatory credits, was 15.4%, compared with an average estimate of 15.6%, according to 19 analysts polled by Visible Alpha. Tesla did not provide a full-year forecast for production, but Musk said Tesla could expand production, given his confidence in self-driving software. Asked whether increasing production would require offering incentives and squeezing profit margins, Musk forecast “nutty” demand for the self-driving Cybercab and said margins would not be sacrificed. Tesla launched a limited rollout of

critics,” Camelthorn Investments adviser Shawn Campbell said. “This earnings report isn’t going to change anyone’s mind on Tesla.” To combat a demand drop, Tesla introduced lower-cost “Standard” variants of Model Y and Model 3 vehicles earlier this month, stripping out a myriad of premium and basic features and lowering prices by about US$5,000 to US$5,500. While Tesla hopes the cheaper variants will drive higher volumes, analysts warn the move will squeeze margins as thousands of dollars of cost cuts per vehicle may not fully compensate for lower selling prices. Tesla said it was on track to start volume production of its Cybercab robotaxi, Semi truck and Megapack 3 battery in 2026. Tesla’s energy business also showed strength, including an 81% increase in storage deployment in the quarter, and its robot plans are advancing, with production of humanoid bot Optimus hopefully starting toward the end of 2026, Musk said. The electric vehicle maker reported total revenue of US$28.1

Shares of the Austin, Texas-based company were down 4% in extended trading. Demand for Tesla’s vehicles and those of its rivals is also expected to drop through the rest of the year without the tax credits that have been a key driver of EV sales. Apart from the removal of tax credits and the waning sales of regulatory credits that traditional automakers bought to make up for their polluting vehicles, Tesla is also grappling with tariffs imposed by the Trump administration on auto-parts imports, which Chief Financial Officer Vaibhav Taneja said cost Tesla more than US$400 million in the quarter. The EV maker also reported a 50% rise in operating expenses driven by AI and other research and development projects, an increase in stock-based compensation, and on an earnings conference call, Taneja said capital expenditures would rise substantially in 2026. “Tesla dished out just the right amount of good and bad news to both appease its fans while also providing enough evidence for its

Amazon uses AI to make robots better warehouse workers SAN FRANCISCO: Amazon on Wednesday said it is speeding up the automation of its warehouses with the help of artificial intelligence and robotics, raising questions about the future of human workers. Carolina, follows that of a Vulcan robot early this year that Amazon described as having a sense of touch while tending to its duty helping fulfill orders for customers. “These systems are not experiments. They’re real tools built for you to make your job safer, smarter and more rewarding.” Igor Pedan, with Amazon Robotics, introduces Blue Jayduring Amazon’s “Delivering the Future” presentation at DUR3 Delivery Station in Milpitas, California. – AFPPIC

However, The New York Times on Tuesday reported that robotics could let Amazon avoid hiring 160,000 workers in just two years even as its online retail business grows. Automation of Amazon warehouses could cut the need to hire, particularly when it comes to temporary workers needed for peak holiday shopping demands. Amazon on Wednesday also demonstrated an AI agent designed to manage robots and warehouse teams more efficiently. The e-commerce giant’s innovations reach outside distribution centers, with Amazon demonstrating camera-equipped smart glasses that display navigation and delivery instructions to drivers. – AFP

Amazon Robotics chief technologist Tye Brady credited AI with slashing the time it took to design, build and deploy Blue Jay by some two-thirds to just slightly more than a year. “That’s the power of AI. Expect more rapid development cycles like this ... we’re on a trajectory to supercharge the scale and impact of innovation with our operations.” Brady dismissed concerns that enhancing warehouses with robotics and AI will mean fewer jobs for humans, saying Amazon has created more US jobs in the past decade than any other company. “To our frontline employees, here’s my message,” Brady said.

The e-commerce colossus known for its promise of quick deliveries showed off robotic arms and other high-tech warehouse tools in Silicon Valley, saying AI is not only powering innovations but accelerating how quickly they are developed by the second largest employer in the United States. “Blue Jay” robotic arms billed as capable of efficiently picking, sorting, and consolidating at a single workstation were among AI enhanced equipment items demonstrated by Amazon at a conference held in a massive distribution centre in Silicon Valley. The arrival of Blue Jay, being tested in South