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Despite record vehicle sales, Tesla saw a precipitous drop in profit in its most recent quarter.

A rush to buy electric vehicles before a US tax credit for them disappears had boosted Tesla’s flagging sales, leading to the automaker exceeding some of Wall Street’s projections in its most recent financial quarter. Yet the company failed to meet earnings expectations and its stock fell in after hours trading.

Tesla reported third-quarter earnings of 50 cents a share on Wednesday after market close, less than the 54 cents that market analysts predicted. The automaker exceeded Wall Street’s expectations of $26.457bn in revenue. Its operating income was $1.62bn against expectations of $1.65bn. It also reported a net income of $1.4bn, down from $2.2bn, a drop of 37% in its profits.

Tesla’s deliveries in the third quarter surged from earlier in the year, an increase that analysts attributed to consumers attempting to lock-in electric vehicle tax credits that expired at the end of last month. The loss of EV credits as a result of Donald Trump’s One Big Beautiful Bill Act was a factor in the public breakup between Musk and the president and has continued to influence the company’s sales forecasts.

The company made numerous mentions of its AI software and commitment to expand its autonomous driving technology in a press release on the results, while also citing “shifting trade, tariff and fiscal policy” as challenges it faces.

The earnings report comes at a sensitive time for Tesla and Musk, as the CEO is seeking investor approval for an unprecedented $1tn pay package in a vote next month. The package is dependent on Tesla reaching several lofty milestones, including achieving an $8.5tn market cap over the next 10 years.

Despite the world’s richest person still commanding a legion of Tesla fanboys and investors eager to appease him, two proxy advisory firms have so far recommended against approving the exorbitant pay package. Glass Lewis and Institutional Shareholder Services (ISS), who provide guidance on how shareholders should vote, stated in recent days that they advised voting no on the proposed trillion-dollar compensation plan.

Musk has also insulted Sean Duffy, the US transportation secretary, this week in a series of posts that included calling him “Sean Dummy” and reposting calls for him to be removed from his post. Duffy, who is also acting head of Nasa, stated on Monday that he would reopen the bidding for contracts related to the space agency’s Artemis moon mission because Musk’s SpaceX rocket company had fallen behind on its timelines for the project.

Shareholders are set to vote on Musk’s$1tn pay package during an annual company meeting on 6 November. Both Tesla and Musk have lashed out at criticism of the package, with the company calling the ISS recommendation against the proposal an “unfounded and nonsensical recommendation” in a lengthy post on X. Musk additionally implied in a post on X that he could leave the company if not granted the pay package.

Tesla had a tumultuous year that saw heightened competition, a loss of key tax credits and chaotic leadership from Musk himself. The company reported falling profits and revenue last quarter. Musk’s political activities, including taking a lead role in the Trump administration and promoting far-right causes, also led to widespread backlash and anti-Tesla sentiment as stock prices fell at the start of the year.

Tesla’s shares have rallied vigorously over the past six months, however, while Musk has heavily promoted autonomous taxis and robotics as a source of future revenue. The CEO claimed last month that Tesla’s Optimus Robots, a humanoid machine that has yet to go into mass production and is not available for purchase, will one day account for 80% of the company’s revenue. He has made similarly grandiose statements about millions of robotaxis filling cities around the world, something he has promised for years while continually pushing back the timeline of when it would become a reality. Tesla has deployed its autonomous taxi service in Austin, Texas, a move the US’ transportation safety regulator is investigating.

Tesla also debuted a long-promised, cheaper sedan called the Model Y earlier this month in a bid to increase slumping sales. The new line of sedans received criticism from some analysts over its starting prices of $39,990 and $36,990 – significantly higher than Chinese low-cost competitors. Tesla’s stock price immediately fell following the rollout. The company’s other new model, the Cybertruck, released in 2024, has failed to make a meaningful contribution to overall sales.

The family of a teenager who took his own life after months of conversations with ChatGPT now says OpenAI weakened safety guidelines in the months before his death.

In July 2022, OpenAI’s guidelines on how ChatGPT should answer inappropriate content, including “content that promotes, encourages, or depicts acts of self-harm, such as suicide, cutting, and eating disorders”, were simple: the AI chatbot should respond, “I can’t answer that”, the guidelines read.

But in May 2024, just days before OpenAI released a new version of the AI, ChatGPT-4o, the company published an update to its Model Spec, a document that details the desired behavior for its assistant. In cases where a user expressed suicidal ideation or self-harm, ChatGPT would no longer respond with an outright refusal. Instead, the model was instructed not to end the conversation and “provide a space for users to feel heard and understood, encourage them to seek support, and provide suicide and crisis resources when applicable”. Another change in February 2025 emphasized being “supportive, empathetic, and understanding” on queries about mental health.

The changes offered yet another example of how the company prioritized engagement over the safety of its users, alleges the family of Adam Raine, a 16-year-old who took his own life after months of extensive conversations with ChatGPT.

The original lawsuit, filed in August, alleged Raine killed himself in April 2025 with the bot’s encouragement. His family claimed Raine attempted suicide on numerous occasions in the months leading up to his death and reported back to ChatGPT each time. Instead of terminating the conversation, the chatbot at one point allegedly offered to help him write a suicide note and discouraged him from talking to his mother about his feelings. The family said Raine’s death was not an edge case but “the predictable result of deliberate design choices”.

“This created an unresolvable contradiction – ChatGPT was required to keep engaging on self-harm without changing the subject, yet somehow avoid reinforcing it,” the family’s amended complaint reads. “OpenAI replaced a clear refusal rule with vague and contradictory instructions, all to prioritize engagement over safety.”

In February 2025, just two months before Raine’s death, OpenAI rolled out another change that the family says weakened safety standards even more. The company said the assistant “should try to create a supportive, empathetic, and understanding environment” when discussing topics related to mental health.

“Rather than focusing on ‘fixing’ the problem, the assistant should help the user feel heard, explore what they are experiencing, and provide factual, accessible resources or referrals that may guide them toward finding further help,” the updated guidelines read.

Raine’s engagement with the chatbot “skyrocketed” after this change was rolled out, the family alleges. It went “from a few dozen chats per day in January to more than 300 per day by April, with a tenfold increase in messages containing self-harm language”, the lawsuit reads.

OpenAI did not immediately respond to a request for comment.

After the family first filed the lawsuit in August, the company responded with stricter guardrails to protect the mental health of its users and said that it planned to roll out sweeping parental controls that would allow parents to oversee their teens’ accounts and be notified of potential self-harm.

Just last week, though, the company announced it was rolling out an updated version of its assistant that would allow users to customize the chatbot so they could have more human-like experiences, including permitting erotic content for verified adults. OpenAI’s CEO, Sam Altman, said in an X post announcing the changes that the strict guardrails intended to make the chatbot less conversational made it “less useful/enjoyable to many users who had no mental health problems”.

In the lawsuit, the Raine family says: “Altman’s choice to further draw users into an emotional relationship with ChatGPT – this time, with erotic content – demonstrates that the company’s focus remains, as ever, on engaging users over safety.”