Tesla is spending less now, but the bill is coming later: Chart of the Day

Tesla cut $5 billion from this year's spending plan. It also told investors the bill is going up from here.

On Wednesday, Tesla ( TSLA ) lowered its 2026 capital spending guidance to about $20 billion from $25 billion. The cut came after a quarter in which it spent $4.73 billion, about $3.2 billion less than analysts expected, according to Bloomberg estimates. The lighter spending helped Tesla generate $1.53 billion in free cash flow , when Wall Street had braced for it to burn nearly $5 billion.

"Our capex for the next few years would continue to expand as we add more robotaxi fleet, we expand our production capacity for Optimus, install manufacturing capacity for solar, purchase additional SI compute infrastructure, and build a semiconductor fab," Chief Financial Officer Vaibhav Taneja said on the company's earnings call.

Tesla also lined up the ability to borrow up to $30 billion to support that growth, though Taneja said it doesn't plan to tap the money this year. Shares fell 2% after hours following a 3.4% gain in the regular session.

Through three quarters, Tesla has spent about $13 billion. The new plan leaves roughly $7 billion for the fourth quarter.

That would still be a record, about 20% above the $5.8 billion Tesla spent in the second quarter. But it's well short of what the old plan required: nearly $12 billion in one quarter, more than the $8.5 billion Tesla spent in all of 2025.

The biggest project is just getting started. Musk said Terafab, the chip plant Tesla is building with SpaceX, will need tens of billions of dollars in equipment through early 2028 and likely more than $100 billion over the long term. The two companies still have to work out who pays for what. Real production isn't expected until late 2028.

Spending on other projects is already ramping. Tesla expects to have 400 megawatts of AI training compute running by year-end. It has started Optimus robot production in Fremont, Calif., and is building a second, larger robot factory in Austin.

"We're definitely, as I say in Vegas, betting on the come," Musk said.

Internal AI tools helped analyze interview transcripts, research, and draft this post. Humans reviewed, edited, and fact-checked this post before publication.

Jared Blikre is the global markets and data editor for Yahoo Finance. Follow him on X at @SPYJared or email him at jaredblikre@yahooinc.com.