Tesla slides about 5% before the bell after cutting its 2026 spending plan, and Nasdaq futures follow it lower
Tesla beat on earnings but trimmed its capital spending forecast to about $20 billion. Meta's beat meets a $25 billion court penalty, chip-equipment stocks slip after Lam Research, and Brent climbs above $111.
Photo: Larry D. Moore / Wikimedia Commons (CC BY 4.0)
Wednesday's rally ran into Tesla overnight. Elon Musk's carmaker beat Wall Street's earnings estimate after the close, then lowered how much it plans to spend this year, and the stock gave back an early after-hours gain. By Thursday morning Tesla was one of the heaviest weights on index futures, with technology and chip stocks leading a broad pullback before the open.
Tesla was down about 4.6% in premarket trading, according to CNBC, while FXStreet put the decline at nearly 5%. The shares had risen about 2% right after the report before reversing during the earnings call, according to Reuters and Benzinga.
Why Tesla reversed
The headline numbers were better than feared. Tesla reported adjusted earnings of 48 cents a share on revenue of $28.05 billion, according to CNBC and Investing.com, and generated $1.53 billion of free cash flow in the quarter, when analysts had expected it to burn cash, according to Reuters.
The issue was the spending plan. Chief financial officer Vaibhav Taneja said Tesla now expects capital expenditures of about $20 billion for 2026, down from a previous forecast of more than $25 billion, "as a result of managing our capital deployment efficiently," according to the call transcript and Benzinga. Reuters described it as a cut of about a fifth. Tesla did not say which projects would get less money.
For a stock priced largely on robotaxis, the Optimus humanoid robot and AI chips, lower spending raised a question about speed. Musk said it would take "probably at least a year, maybe a little longer" to reach a production rate of 20,000 Optimus units a week, Benzinga reported. Deutsche Bank wrote that the capex cut "raised questions about the speed of its transition into AI and robotics," according to FXStreet. Taneja said spending will rise again in later years as the robotaxi fleet grows.
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Meta: a beat, a split and a $25 billion ruling
Meta Platforms reported third-quarter earnings of $3.83 a share on revenue of $64.6 billion, according to Investing.com and Marcus Today, and guided fourth-quarter revenue to $73 billion to $76 billion, with the top of that range above analyst estimates. It narrowed its 2026 capital expenditure range to $135 billion to $145 billion. The company also unveiled a new class of non-voting shares, which Yahoo Finance described as a 2-for-1 split that gives Class A holders one non-voting Class C share each.
Premarket trading in Meta swung between small gains and small losses, with CNBC showing a rise of about 0.7% and FXStreet a dip of about 0.4% at different times.
Hours before the report, a New Mexico judge ordered Meta to pay $25 billion after a jury found it had misled Facebook users about how their data was handled, a case that grew out of the Cambridge Analytica scandal, according to the BBC, NBC News and Bloomberg Law. Judge Francis Mathew said a penalty of more than $219 billion was warranted under state law before reducing it to $25 billion. Meta's chief legal officer, C.J. Mahoney, said the company is "confident we will prevail on appeal."
Chips give back Wednesday's gains
Lam Research fell about 6% to 7% after hours despite results that slightly beat expectations, according to Investing.com and Cannon Trading, and KLA and Applied Materials slipped in sympathy. Yahoo Finance said semiconductor stocks were leading the futures lower, reversing part of Wednesday's advance.
That advance was solid. The S&P 500 rose 0.58% to 7,757.17 on Wednesday for a third straight gain, the Nasdaq Composite added 1.05% to 26,702.86 and the Dow climbed 360.21 points, or 0.69%, to 52,856.09, according to CNBC. SpaceX's 161% revenue jump and Super Micro Computer's raised forecast fueled the buying; Super Micro closed up about 9.6% at $35.57, according to Investing.com.
Futures, oil and yields
Quotes for the futures varied with the hour. CNBC had Nasdaq 100 futures down 1.8% and S&P 500 futures down about 1.0% in the early morning, while a later Yahoo Finance update showed both down about 0.9%. Dow futures were off between about 0.2% and 0.7%.
Oil added pressure. Brent crude climbed to between roughly $111 and $112.40 a barrel and U.S. crude neared $100 after The New York Times reported that the U.S. and Israel had drawn up plans for renewed strikes on Iran after next month's midterm elections, according to CNBC and TipRanks. The 10-year Treasury yield fell about 7 basis points to around 5.07%, according to CNBC, as investors moved toward bonds.
The calendar today
Initial jobless claims for the week ended Oct. 17 come out at 8:30 a.m. ET, followed by the Conference Board's leading economic index at 10 a.m. and the Kansas City Fed's manufacturing survey at 11 a.m. Procter & Gamble, American Airlines, Union Pacific, Honeywell, Lockheed Martin and Comcast are among the companies reporting before the open. Western Digital and Newmont report after the close. The Federal Reserve is in its quiet period before its Oct. 27-28 meeting.
Why it matters
Tesla and Meta together showed two sides of the AI spending story in one evening: one company spending a little less than planned and getting questions about growth, the other spending heavily and being rewarded for the revenue behind it. With oil back above $110 and the Fed a week away, today's open will show whether Wednesday's tech rally can absorb a mixed night of earnings.
