The company delivered 497,099 vehicles worldwide, 7.4% more than a year ago. While that total far exceeds the roughly 439,600 average analyst estimate compiled by Bloomberg, Tesla’s shares slumped Thursday following a record monthly gain in market capitalization.

A rush to take advantage of a $7,500 tax credit for EV purchases delivered a temporary boost to Tesla’s core automotive business, which languished for several quarters under the weight of an aging lineup and rising competition. The company also faced a consumer backlash to Chief Executive Officer Elon Musk’s politics as he worked closely with President Donald Trump early this year.

Investors recently looked past Tesla’s first-half sales weakness to Musk’s promises of growth in areas such as driverless vehicles, artificial intelligence and robotics. The carmaker’s shares soared 33% in September, recouping early-year losses and adding $401.9 billion of market value.

The stock gave back some of those gains Thursday, falling as much as 3.2% as of noon New York time.

“While the numbers were better than expected, we think it is important to highlight the data is backward-looking,” said Garrett Nelson, an equity analyst at CFRA Research. “Looking ahead, we think there are still major questions regarding the earnings impact of legislative changes on the tradeable emissions credit market and EV demand in an unsubsidized US market.”

The phase-out of EV tax credits in the US after Sept. 30 helped drive widespread demand for electric models from the likes of General Motors Co., Ford Motor Co. and [hotlink]Hyundai Motor[/hotlink] Co. last quarter. Rivian Automotive Inc. also reported better-than-expected vehicle deliveries, though the EV maker narrowed its annual guidance toward the lower end of its prior range.

“This sense of urgency created consumer reaction, and we’re seeing that in the data,” Stephanie Valdez Streaty, director of industry insights at Cox Automotive, said on Bloomberg Television. “It’s going to be challenging going forward,” she added, predicting a slowdown in the fourth quarter.

Tesla’s deliveries tally offers a preview of the earnings results scheduled for Oct. 22. Next month the company will hold its annual general meeting, where investors will vote on a new compensation package for Musk potentially worth $1 trillion.

The Model Y SUV and Model 3 sedan continue to do the heavy lifting for Tesla, with combined sales of those two rising 9.4% to 481,166 vehicles  last quarter. Sales of other Teslas — the Model X, Model S and Cybertruck — fell 30%.

The company also reported that it deployed 12.5 gigawatt hours of energy products during the quarter, up from 6.9 GWh a year ago. The company unveiled a next-generation energy-storage system during the quarter, along with a new product called Megablock that combines storage units with a transformer and switchgear.

Tesla has yet to offer many details about the more affordable version of the Model Y that could help buoy sales now that federal EV tax credits have expired in the US. Executives have said that while initial production started in June, they elected to put off the launch until the fourth quarter and cautioned that output will ramp up slower than initially expected.

While the tax credit expiration boosted third-quarter sales, the pull-forward effect could mean weaker EV demand in the final months of the year. Musk has warned Tesla could face several “rough quarters” after the incentives go away and before the company’s autonomous vehicles deploy at scale.

Aside from the tax credit, the Trump administration has also moved to unwind fuel economy and emissions requirements, choking off regulatory credit revenue that supported Tesla for years.

Wall Street is still expecting Tesla to log its second consecutive annual sales decline. Analysts surveyed by Bloomberg project the company will deliver around 1.61 million vehicles in 2025, down from 1.79 million last year.