Key Points
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Tesla’s adjusted earnings per share dropped 18% year over year in the second quarter, to $0.33.
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Tesla expects capital spending of over $25 billion in 2026.
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Tesla shares Robotaxi miles and cities, but not what the service earns.
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Tesla (NASDAQ:TSLA) will release its third-quarter results after the close on Wednesday, Oct. 21, with a live webcast to follow at 5:30 p.m. Eastern time. Some of the quarter is already known. The EV maker said it delivered 486,532 vehicles in the period, up about 1% from the second quarter.
Shares trade around $367 as of this writing, about 25% under their record close of $489.88 in December 2025.
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Most of the attention on the call will likely turn to Tesla’s profit margins. But I’d say the answer that matters most for the stock won’t be in the earnings report at all. If I could ask CEO Elon Musk one thing, it’d be this: How much does Tesla earn per paid Robotaxi mile after the cost of running the car?
Image source: Getty Images.
Earnings alone can’t carry this stock
Tesla is selling more but keeping less. Second-quarter revenue grew 26% year over year, yet its non-GAAP (adjusted) earnings per share dropped 18% to $0.33. Just 1.4% of revenue was left as operating profit.
Now imagine the third quarter comes in much better than that. If adjusted earnings per share doubled to $0.66 and Tesla kept that pace for a full year, the stock would still trade at around 140 times earnings. Using expected 2027 earnings, the price-to-earnings ratio is about 165.
Put simply, I don’t think even a great quarter can come close to explaining a stock priced like this.
“[O]ver time, we expect our hardware-related profits to be accompanied by an acceleration of AI, software and fleet-based profits,” Tesla said in its second-quarter update.
The largest source of those fleet-based profits will likely be Robotaxi, Tesla’s driverless ride-hailing service. It’s arguably where most of the stock’s value sits now.
What does a Robotaxi mile earn?
Tesla hasn’t said.
The company offers lots of other Robotaxi details. Its second-quarter update graphed cumulative paid Robotaxi miles and named seven major metro areas where the service runs — six of them with no safety driver at the wheel. And on Sept. 3, Tesla’s vice president of AI, Ashok Elluswamy, said Robotaxi had topped 1 million unsupervised miles, up from the more than 380,000 he cited on the Julyearnings call
Also, Tesla has started making the Cybercab, its steering-wheel-free car for the fleet, at its Texas plant, where it lists installed capacity of over 125,000 Cybercabs a year. Tesla began offering Cybercab rides to the public in Austin in early September.
But Tesla doesn’t share what Robotaxi takes in or what it costs to run. And these costs could be significant. In its last quarterly filing, Tesla said it’s building infrastructure for the service, such as vehicle cleaning and maintenance, charging, security, teleoperations (remote support), and fleet management.
Musk, of course, is confident. On the second-quarter call, he said “the economics will be so compelling” that he expects demand for Robotaxi to outpace Tesla’s ability to meet it.
That might prove right. But for now, investors are paying for those economics without a per-mile number to check them against.
Tesla’s spending is rising fast
Tesla is also spending a lot as investors wait. Capital expenditures were around $5.8 billion in the second quarter, up 142% from a year before, and management expects over $25 billion for 2026. That spending drove free cash flow to negative $1.1 billion that quarter, down from positive $146 million a year before. And chief financial officer Vaibhav Taneja said capital spending “will grow for the next two to three years” as Tesla expands its Robotaxi fleet, among other projects.
Musk said he’s confident the investments will bring “really the best CapEx returns that we’ve ever seen.” Robotaxi’s per-mile economics would be one of the first ways for investors to check that claim.
Yes, Robotaxi is still in its early days, and one number can’t settle a bet this big. Costs per mile could also drop as the fleet grows. But it would show whether Robotaxi already makes money on every ride, or how far it still has to go.
In the end, if Musk shares a per-mile profit that holds up after charging, cleaning, remote support, and wear on the cars, I’d take a much closer look at the stock. It would help even more if Tesla started reporting Robotaxi results separately. But if he gives just another forecast, I think shares still look too pricey at around 165 times expected 2027 earnings.
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Daniel Sparks has clients with positions in Tesla. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.
