February 2, 2023


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Tesla shares rise in profits: “Millions of fully self-driving cars can be sold at a gross margin of 100%”

Tesla (TSLA) reported mixed results for the fourth quarter on Wednesday, beating earnings estimates while missing out on revenue views. Tesla stock soared on Wednesday, extending a robust rebound of more than 40% from the bear market trough.


After a terrible 2022, during which Tesla stock fell sharply in December, stocks have fallen again to start 2023. However, Tesla has rebounded since announcing deep car price cuts in China on January 6, and has continued to rise since price cuts were announced in United States and Europe. after a week.

Analysts and investors will be looking closely at the results on Wednesday to get a better idea of ​​what Tesla expects for 2o23.

Tesla stock rose 1.7% after hours. Shares rose 0.4% to 144.47 during the day Wednesday Market tradeand upside down.

Tesla earnings

Estimates: Analysts expect earnings to rise 33% to $1.13 per share in the fourth quarter. At the end of December 2022, analysts expected earnings per share to be $1.25. Analysts had set the revenue target at 39% growth to $24.67 billion.

Earnings: Tesla’s EPS advanced 40% to $1.19 while revenue grew 37% to $24.32 billion in the fourth quarter.

For the full year, revenue increased 51% to $81.46 billion, below estimates. Earnings ballooned 80% to $4.07 a share, beating Wall Street expectations.

Tesla has already announced its delivery It reached a record high of 405,278 in the fourth quarter. This failed to dampen expectations despite strong stimulus at the end of the year. Vehicle deliveries jumped 31% year over year and nearly 18% versus 343,830 in the third quarter. Deliveries also swelled by 40% to 1,313,851 in 2022. That was well below the company’s 50% growth target.

Analysts expected Tesla’s fourth-quarter deliveries to be roughly 420,000, down significantly from higher estimates. Tesla’s Q3 deliveries were also lower.

Tesla production reached 439,701 in the fourth quarter, outpacing deliveries by more than 34,000. In the third quarter, production exceeded sales by just over 22,000. Tesla production reached 439,701 in the fourth quarter, outpacing deliveries by more than 34,000. In the third quarter, it exceeded production sales of just over 22,000.

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With increased production at the company’s factories in Berlin and Austin, Texas, Tesla’s total production capacity is now well above 450,000 per quarter.

Tesla unit sales reached 1,313,851 for 2022, up 40% versus 2021 but below the 50% target. The Model 3 sedan and Model Y crossover accounted for the vast majority of sales. High-end Models S and X cars accounted for the remainder.

Meanwhile, the Cybertruck is scheduled to arrive in 2023, which will be Tesla’s first new model since the Model Y launched in early 2020. The much-delayed truck will go into “early production” in the middle of the year, according to CEO Elon. Musk. Other reports indicate that the Cybertruck will begin mass production in late 2023.

Tesla has also begun delivering half of its long-distance trucks to… PepsiCo (PEP) in December. It’s unclear how many semi-trucks will be produced in 2023, with prices and key specs still unclear. Tesla plans to build a $3.5 billion manufacturing facility in northern Nevada for semi-trucks, according to the Nevada Independent.

On Wednesday, Tesla confirmed that production and delivery challenges throughout 2022 were “largely centered in China.”

Tesla plans to increase its production volume “as fast as possible” to align with its 50% compound annual growth rate goal. That goal dates back to 2021. For 2023, Tesla said it expects to produce about 1.8 million vehicles, an increase of 37% compared to 2022.

The electric car giant also said the e-car “remains on track to begin production later this year.”

The company added that its next-generation vehicle platform is under development and that additional details will be shared at Investor Day on March 1, 2023.

Tesla stock: Earnings come after price cut

Tesla’s fourth-quarter earnings track Tesla China EV records bouncing a week From January 5 to 16, after the recent big price cuts. The latest registration numbers appear to reflect some of the benefits from Tesla’s January 6 decision to cut prices in China.

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Tesla slashed prices for the Model 3 and Y in China, with the base Model 3 slashing more than 13% to $33,570. Local media reports in China indicated that Tesla was He received 30,000 applications within three days of the announced cuts, according to CnEVPost.

As announced by Tesla Price cuts in the US and Europe. This will make more models eligible for the $7,500 tax incentives under the Inflation Reduction Act (IRA).

The EV giant has slashed prices for the American Model 3 by 6%-14%, depending on the model. The standard 3 RWD trim was cut by $3,000 to $43,990. With the vehicle IRA tax credit applied, consumers who meet the income limits would pay $36,240.

Performance Form 3 was reduced from $9,000 to $53,990, which is below the $55,000 limit for tax credits. Meanwhile, Tesla’s base Model Y was slashed by $13,000, or roughly 20%, to $52,990, also below the tax credit limit. The performance variant for that car is reduced to $56,990, and it’s also down $13,000.

Musk told investors on Wednesday that so far in January, Tesla has seen “the strongest bids in a year to date than at any time in our history.” The Tesla CEO said that orders are currently coming in at “nearly twice the rate of production” and that’s driving up Model Y prices.

“I think there are an enormous number of people who want to buy a Tesla but can’t afford it,” Musk said. “And so these price changes make a real difference for the average consumer.”

“Our goal at Tesla has always been to make affordable cars for as many people as possible, so I’m glad we’re able to do that,” he added.

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self-driving situation

Tesla has deployed a beta of fully self-driving (FSD) to city streets for nearly 400,000 customers in North America, Musk said during the earnings call Wednesday.

The EV giant currently has about 100 million FSD miles, not including highway driving, according to Musk.

“We wouldn’t have launched the FSD Beta if the safety stats weren’t stellar,” Musk said.

The Tesla CEO added that almost all Tesla cars can currently have self-driving software loaded on them.

“That means there are millions of fully self-driving cars that can be sold at basically 100% gross margin,” Musk said. “The value of the FSD grows as the autonomous capacity grows, and then when it becomes fully autonomous, that’s an increase in fleet value that may be the largest increase in asset value of anything in history.”

Tesla stock

Tesla stock is up 43% since the January 6 low of 101.81, reaching the 50-day and 10-week lines.

This is despite the fact that a number of analysts have also weighed in on Tesla stock, Lower your target price and earnings estimates.

TSLA stock ranks third in the world Automotive Group. Tesla stock contains 46 Composite classification Out of 99. The stock has a 5 relative strength rating, exclusive IBD stock check A measure of share price movement. The EPS rating is 75.

Please follow Kit Norton on Twitter @employee for more coverage.

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