Tesla beat earnings expectations with a 47% increase in revenue and an 18% increase in profits, yet Tesla stock fell 4% after hours. So why did TSLA stock fall after beating earnings expectations? It all has to do with the valuation of Tesla stock, and the fact that TSLA was pricing in a 400% earnings increase, yet Tesla reported earnings of only an 18% earnings increase. Tesla stock won’t be able to continue to rise if Tesla earnings continue to fall short of what the stock is pricing in. The same thing happened with Netflix earnings today as Netflix stock was down over 8% after hours after Netflix earnings also beat estimates, but NFLX stock fell 8% because of the extremely high valuation going into earnings.