Tesla and Meta Report Tonight as Beats Fail to Lift Stocks

Tesla and Meta report after the close tonight, and this earnings season has already taught the market a hard lesson: beating forecasts is not enough.

Look at the scoreboard from the last 24 hours. SpaceX beat by a wide margin and jumped. Netflix beat on profit and fell about 6 percent on its outlook. Intuitive Surgical beat and fell about 7 percent after a legal disclosure. Super Micro jumped more than 10 percent on Wednesday after it lifted its outlook. Same season, same day, opposite verdicts. The difference was not the quarter that just ended. It was what each company said about the next one, and what its plans cost.

On Wednesday the pattern held into the afternoon. Reuters reported the Nasdaq up 1.05 percent at 11:36 a.m. ET, with SpaceX up 9.8 percent, Tesla up 3.5 percent ahead of its own report, and Super Micro up 10.3 percent to the top of the S and P 500 after the AI server maker forecast revenue and margins above Wall Street estimates. "The sentiment around tech has shifted," Mark Hackett, chief market strategist at Nationwide, told Reuters, adding that stress in credit markets is keeping a lid on breakouts in tech and that skepticism about the AI buildout is very high.

What happened

SpaceX set the tone on Tuesday night. Its third quarter revenue came in at 14.58 billion dollars against about 12.74 billion expected, with earnings of 35 cents a share against 12 cents expected, and the report marked its first profit as a public company. Musk added the headline that travelled furthest: SpaceX and Tesla have formed committees to explore a potential merger, and he said a merger would be "a good idea." Barron's noted that Meta and Tesla were both beating their average earnings day returns on Wednesday, with Tesla on track for its strongest pre-earnings session since April 2025, and credited the SpaceX report for giving investors an early read on Musk's companies.

Netflix showed the other side. The streamer beat on profit, then fell about 6 percent because its fourth quarter and full year guidance came in soft. Intuitive Surgical also beat, then fell about 7 percent, because a 450 million dollar settlement disclosure and a narrower procedure outlook mattered more than the beat.

Why it matters

The price of money explains the mood. The 10 year Treasury yield sits near 5.125 percent, per this morning's market brief. At that level, a promise of profit in three years is worth less today, and a spending plan is a cost investors feel now. Companies are being marked on guidance, cash and the bill for AI hardware, not on whether they cleared a consensus number that analysts set months ago.

For ordinary holders, the practical point is simple. A beat headline no longer tells you which way a stock moves after earnings. The outlook paragraph does. Netflix owners learned that on Tuesday night. Tesla and Meta owners get their turn tonight.

The merger talk adds a second layer. If SpaceX and Tesla ever combine, "Musk exposure" stops being a choice between a car and robot company and a rocket company. Committees are not a deal, and no terms have been stated by any source. But the fact that both boards have staffed the question tells holders of either stock that the two stories may not stay separate.

Key numbers

• 14.58 billion dollars: SpaceX third quarter revenue, against about 12.74 billion expected
• 35 cents vs 12 cents: SpaceX earnings per share against expectations
• About 6 percent: Netflix's fall after a profit beat, on soft guidance
• About 7 percent: Intuitive Surgical's fall after a beat, on a 450 million dollar settlement disclosure
• 10.3 percent: Super Micro's rise on Wednesday after it raised its outlook
• 9.8 percent: SpaceX's rise on Wednesday; Tesla rose 3.5 percent into its own report
• 5.125 percent: the 10 year Treasury yield in this morning's market brief

What happens next

Tesla reports after the close, with the market expecting about 44 cents a share on about 27.8 billion dollars of revenue, and holds its webcast at 5:30 p.m. ET. Meta reports after the close too, with its call at 4:30 p.m. ET, and the watch item is capital spending: how much more Meta plans to pour into AI, and whether advertising revenue still covers it. Those two calls set the AI spending line for the rest of the season. If either company pairs a beat with a bigger bill and a softer outlook, this week's rule says the bill wins.