Elon Musk raises the stakes for vote on his pay

Tesla said Wednesday that third-quarter revenue jumped nearly 12% from a year earlier to $28.1 billion. That beat Wall Street’s consensus target by nearly 6%—the widest such margin in more than four years, according to FactSet data. But the gain still wasn’t a complete shock, given that Tesla had already reported a jump in vehicle deliveries for the quarter.

Tesla has a lot going on these days besides building cars. The company is working on its own artificial-intelligence chips, self-driving taxicabs and humanoid robots. Chief Executive Elon Musk said during Tesla’s earnings call Wednesday that robots alone will likely be “the biggest product of all time."

Maybe, but that doesn’t come cheap, which is why expenses like R&D keep going up even as revenue has trended down this year. Tesla’s operating income for the third quarter fell 40% year over year and missed Wall Street’s targets.

The company also warned during its conference call that capital expenditures would go up “substantially" next year. Tesla’s share price slipped more than 3% in after-hours trading Wednesday.

The latest results are further complicated by the fact that the recent strength in electric-vehicle sales has nothing to do with Tesla. The expiration of tax credits sparked a rush of sales across the EV industry—with some automakers reporting even stronger jumps in U.S. unit sales. Tesla actually saw its share of EV sales in the U.S. fall to 41% for the third quarter compared with 49% in the same period last year, according to data from Cox Automotive.

But even that is a seemingly mundane issue for a company now valued at nearly $1.5 trillion, roughly the combined market capitalization of every other publicly traded car company in the world, according to data from S&P Global Market Intelligence. The majority of Tesla’s value lies in hopes for what the company hasn’t done yet, like building a massive Uber-like ride-hailing service with its own self-driving Cybercabs, or putting a walking, human-sized robot in every home.

All are projects close to Musk’s heart, which is also why the company is sparing no effort to keep him around. Tesla’s board of directors has proposed a compensation plan for its co-founder and leader that would add an additional 12% to his already substantial stake in the company, and carry a value of a little more than $1 trillion, if the company hits all the milestones outlined in the plan. One of those targets is for Tesla to reach a market cap of $8.5 trillion, or adding roughly two Nvidia’s to its current value.

An ambitious goal, to say the least. And transferring that kind of wealth to a man worth nearly a half-trillion dollars already seems like overkill, though Musk insisted Wednesday that his aim isn’t about the money. “I don’t feel comfortable building that robot army if I don’t have at least a strong influence," he said on the call. He added later that he worries about building such an army, then getting ousted “because of some asinine recommendations from ISS and Glass Lewis"—shareholder advisory firms he described as “corporate terrorists" that have recommended against Tesla’s compensation plan.

Musk has also previously hinted that he would consider leaving Tesla if the compensation plan isn’t approved. But that creates a quandary of his own making, as leaving the company would still cost him control of the robot business and everything else he has built at Tesla. Starting over from scratch would be a tall task even for him.

Tesla’s investors have to decide if Elon, with all his notable talents and baggage, is still worth the trouble. It isn’t a simple choice.

Write to Dan Gallagher at dan.gallagher@wsj.com