SpaceX and Tesla CEO and owner of Twitter Elon Musk attends the Viva Technology conference dedicated to innovation and startups at the Porte de Versailles exhibition center on June 16, 2023 in Paris, France.
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tesla reported Profits after the bell, showing record quarterly revenue but lower margins thanks to price cuts and incentives. The stock price remains essentially unchanged in after-hours trading.
- Revenue: $24.93 billion. That may not compare to the $24.47 billion expected by Refinitiv.
- Profits: 91 cents per adjusted share. That may not compare to the 82 cents per share expected by Refinitiv.
Net income (GAAP) was $2.7 billion, an increase of 20% over last year. Operating income, however, was down 3% from the prior-year quarter to $2.40 billion.
For comparison, during the first quarter of 2023, Tesla reported net income of $2.51 billion on revenue of $23.33 billion. During the second quarter of last year, Tesla reported net income from $2.27 billion to $16.93 billion in revenue.
Earlier this month, Tesla reported 466,140 total vehicle deliveries for the second quarter and said it had produced 479,700 electric vehicles. Deliveries are the closest approximation of sales reported by Tesla.
Those deliveries were higher than Wall Street had expected and were driven in part by incentives and discounts. Consequently, operating margins reached 9.6%, the lowest for at least the last five quarters. Total gross margin reached 18.2%, also a low for the same period.
Tesla explained in a shareholder conference that its lower margins in the second quarter were due to lower average selling prices “due to the mix and price” of the cars it has been selling, and the cost of ramping up production of battery cells it designed in-house, known as 4680 cells, among other factors.
Tesla’s core automotive business revenue increased 46% year-over-year to $21.27 billion, a sequential increase of about 6.5%. Its energy generation and storage revenue, from solar installations and battery backup, increased 74% year-over-year to $1.51 billion. With more vehicles on the road, Tesla’s “services and other” revenue, including fees for out-of-warranty vehicle repairs, rose 47% to $2.15 billion.
Tesla’s research and development costs rose to $943 million (from $771 million in the first quarter) with the company writing in a shareholder deck that it focuses on “being at the forefront of AI development” and has begun production of its Dojo “training computers.”
Tesla’s crossover, the Model Y, became the best-selling vehicle worldwide in the first quarter of 2023.
Tesla said in an investor presentation that Cybertruck “factory tooling” is on the way, but the company is only producing “launch candidate” versions so far. The news could disappoint fans eagerly awaiting the start of deliveries of the sci-fi-inspired, angular pickup truck that Elon Musk first promoted in 2019. In recent days, Tesla posted a photo via its social media account on Twitter showing factory workers huddled around a Cybertruck at its Austin, Texas, facility. The tweet read: “First Cybertruck built in Giga Texas!”
In addition to the Cybertruck details, investors will be curious about updates on Tesla’s production of 4,680 battery cells, seen as critical to increasing production of the company’s Class 8 Semi Truck and Cybertruck; in Tesla’s development of a humanoid robot, called the Tesla Bot or Optimus; and about a new factory that Tesla said it will build in Mexico.
Investors are also looking for updates on the company’s progress toward developing a robotaxi-ready or autonomous vehicle. While Musk touted Tesla’s self-driving ambitions in 2016, he did say the company would go on a hands-free tour of the US in late 2017. Tesla has yet to complete that mission.
The company’s earnings call is scheduled to begin at 5:30 p.m. ET.