EPS — API Ninjas actual does not reconcile with a unique Quartr EPS basis
Verdict
Revenue missed: total revenues of $28,046 million against the API Ninjas estimate of $28,056.79 million, a shortfall of $10.8 million, and $28,095 million a year ago.
GAAP diluted EPS of $0.22 missed the API Ninjas estimate of $0.4488, with basic EPS of $0.24 and net income attributable to common stockholders of $787 million against $1,373 million.
Profitability improved where the product is made and fell where it is funded: total gross margin rose to 19.6% from 18.0% and gross profit to $5,494 million from $5,054 million, while income from operations dropped to $718 million from $1,624 million.
The only forward figure given is capital expenditure: in excess of $20 billion in 2026, with $13.01 billion already spent in the first nine months against $6.13 billion a year ago.
The one thing that matters: flat revenue and a better gross margin mean the entire earnings decline sits in operating expense, where R&D rose 69% to $2,761 million and SG&A 29% to $2,015 million. That is a spending choice, and the release does not say when it peaks.
Key metrics
Metric
Reported
Prior year
Change
Total revenues
$ 28,046
$ 28,095
$ (49)
Total gross margin
19.6%
18.0%
—
Income from operations
718
1,624
—
Net income attributable to common stockholders
$ 787
$ 1,373
decreases of $586 million
Automotive regulatory credits
113
417
(73)%
Research and development
$ 2,761
$ 1,630
69%
Guidance changes
Item
New guidance
Prior guidance
2026 capital expenditures
in excess of $20 billion in 2026
—
Quality of earnings
The earnings drop is above the operating line, not in the trading business. Gross profit rose to $5,494 million from $5,054 million and automotive gross margin to 18.5% from 17.0%, while total operating expenses of $4,776 million against $3,430 million turned that gain into income from operations of $718 million versus $1,624 million.
Tax flattered the bottom line. The effective tax rate fell to 16% from 29% and the provision to $152 million from $570 million; pre-tax income of $956 million against $1,959 million fell considerably further than the $787 million of reported net income attributable to common stockholders suggests.
Part of the margin gain is a refund, not operations. The quarter carried IEEPA tariff refunds of $526 million and $260 million booked against energy and automotive cost of revenues, offset by $339 million recognised as a reduction of energy revenue.
Gotchas & watch items
Energy revenue fell 16% to $2,881 million yet segment gross margin rose to 33.1% from 31.4% — the margin came from the $526 million tariff refund against energy cost of revenues, with a lower average selling price per Megapack unit underneath.
Automotive regulatory credits fell 73% to $113 million, and include a $475 million reversal of credit revenue for contractual return of previously delivered credits.
The home market is shrinking as the mix moves abroad: United States revenue of $12,495 million against $14,598 million, with other international at $10,342 million against $7,844 million.
Capital expenditure of $13.01 billion in nine months against a full-year expectation in excess of $20 billion leaves the heaviest spending quarter still ahead, alongside $30 billion of newly committed credit facilities drawn to zero.