Tesla founder Elon Musk attends Offshore Northern Seas 2022 in Stavanger, Norway August 29, 2022.
Carina Johansen | NTB | via Reuters
Electric vehicle maker Tesla reported earnings after the bell, beating on each earnings and revenue. Shares rose greater than 5% after hours after CEO Elon Musk said the corporate might have the option to supply 2 million cars this yr. Listed here are the outcomes.
- Earnings (adjusted): $1.19 vs $1.13 per share expected, per Refinitiv
- Revenue: $24.32 billion vs $24.16 billion expected, per Refinitiv
Within the year-ago quarter, Tesla reported revenue of $17.72 billion and adjusted earnings of $2.52 per share ($0.85 adjusted for an August 2022 stock split).
Tesla reported automotive revenue of $21.3 billion within the fourth quarter, representing 33% growth year-over-year. $467 million of that got here from regulatory credits within the fourth quarter of 2022, up by nearly half from the prior yr in the identical period.
Automotive gross margins got here in at 25.9%, the bottom figure within the last five quarters. Operating money flow was down 29% from last yr, and down 36% from last quarter, coming in at $3.28 billion.
In a shareholder deck, the corporate acknowledged that average sales prices have “generally been on a downward trajectory for a few years,” and said “affordability” can be needed for Tesla to grow into an organization that sells multiple tens of millions of cars annually.
In late 2022 and this yr, Tesla cut prices on its cars around the globe, upsetting customers within the U.S. and China who recently bought latest Teslas at higher prices, and triggering an fast decline in used Tesla prices within the U.S. as well.
The value cuts appear to have sparked demand, nonetheless. Speaking on a call with shareholders and analysts on Wednesday, CEO Elon Musk said, “Up to now in January we have seen the strongest orders year-to-date than ever in our history. We’re currently seeing orders of virtually twice the speed of production.”
One analyst asked Musk why Tesla’s guidance for production was just 1.8 million in 2023 after the corporate has been ramping up production at its latest factories.
Musk replied, “We’re saying 1.8 because there at all times appears to be some friggin’ force majeure thing that happens somewhere on Earth. We do not control if there’s earthquakes, tsunamis, wars, pandemics, etc. If it is a smooth yr, without some big supply chain interruption or massive problem we have now the potential to do 2 million cars this yr. I feel there can be demand for that, too.”
The corporate didn’t issue latest guidance, but reiterated in its earnings release, “We’re planning to grow production as quickly as possible in alignment with the 50% compound annual growth rate goal we began guiding to in early 2021.”
Shareholders asked an issue about how Musk plans to safeguard Tesla’s brand and popularity from any backlash resulting from his political statements, and latest job because the CEO of Twitter, the social media company he acquired in October 2022. Musk replied by promoting Twitter as an ideal method to connect with customers:
“I’ve got 127 million followers. And it continues to grow rapidly. That is that means that I’m reasonably popular. I won’t be popular with some people. But for the overwhelming majority of individuals, just like the follower count speaks for itself. [I have one of] probably the most interactive accounts, social media accounts, possibly on this planet, actually on Twitter, and that really predated the acquisition. So Twitter is definitely an incredibly powerful tool for driving demand for Tesla. And I actually encourage firms on the market of all types automotive or otherwise to make more use of Twitter and to to make use of their Twitter accounts in ways which can be interesting and informative, entertaining, and it would help drive sales just because it has with Tesla.”
Other earnings details
Services and other revenue for Tesla, which incorporates fees for out-of-warranty vehicle repairs, amongst other items, reached $1.6 billion within the quarter.
Revenue from energy generation and storage was up sequentially and year-over-year, reaching $1.31 billion. The price of revenue for its energy division was high, though, at $1.15 billion within the fourth quarter.
Tesla said that it had installed the capability — across all of its factories — to make 100,000 Model S and X vehicles annually, and 1.8 million Model Y and Model 3 vehicles.
Production capability in Shanghai allows Tesla to fabricate 750,000 Model 3 and Model Y electric cars annually, the corporate reported, whereas its first factory in Fremont, California, could make 100,000 of its higher-priced Model S and X vehicles, and 550,000 of its Model 3 and Y vehicles. Factories in Austin, Texas and near Berlin, Germany, each have capability to make 250,000 Model Y vehicles annually, the corporate says.
Tesla also said that roughly 400,000 customers in North America now have the power to check out its experimental, “FSD Beta” driver assistance system. The corporate recognized deferred revenue of $324 million for the quarter related to FSD, it said in a shareholder presentation.
This driver assistance system is barely available to customers who purchase or subscribe to Tesla’s premium driver assistance package, marketed as FSD, or Full Self-Driving capability. Tesla doesn’t make autonomous vehicles, or a driver assistance system that’s protected to make use of with out a driver behind the wheel, able to steer and brake in any respect times. FSD Beta accommodates latest software features that the corporate has not yet fully debugged.
The corporate also reiterated that its Cybertruck pickup is heading in the right direction to start out production this yr in Texas, but is not going to reach volume production until next yr.