Part 6/10:
Tesla's operating margin improved to 17.2% in Q3 from 14.6% in Q2. While still below the long-term target (>19%), the upward trend is promising. When compared to the same quarter last year, Tesla's revenue continues to grow exponentially, but operating expenses grow at a much slower pace, showcasing excellent operating leverage.
This dynamic supports the thesis that Tesla's revenue growth will outpace expenses significantly, boosting overall profitability. The company benefits from operating leverage as it scales, with government incentives further aiding margins.