Tesla’s fourth-quarter and full-year 2022 earnings come in below Wall Street expectations, but the electric vehicle maker is expected to hit revenue for the quarter of $24.03 billion and adjusted earnings per share to land around $1.13 – a record for Tesla. The slowdown in growth seen over the past few quarters is likely due this to stricter regulations on EV sales in China, where Tesla has been the leading player.
Tesla’s earnings report is sure to be interesting, as management will likely discuss the company’s recent progress and future prospects. This includes their new Model 3 sedan, which has been well-received by customers so far. Looking ahead, Tesla plans to launch their much-anticipated Tesla Model Y in the coming year.
Tesla’s challenges in 2017 may lessen as the company moves to address recently aired concerns, such as slowing sales and vehicle price cuts. Tesla is expected to report better-than-expected earnings tomorrow, while CEO Elon Musk projects a Model 3 delivery rate of 500,000 per month by the end of 2018. These announcements may help rehabilitate the stock price which has fallen 65 percent this year due to factors ranging from CEO Elon Musk’s distraction with Twitter to fears over slowing sales in China during a pandemic.
In light of all that has happened, many are anticipating Tesla’s upcoming earnings call and guidance commentary to be quite revealing. Given Tesla’s recent travails, management will undoubtedly be keen to dispel any doubts about their ability to emerge from these challenges triumphant. With so much at stake for the company – both financially and personally for CEO Elon Musk – observers will be watching closely to see what he has to say on the matter.
Tesla’s stock has surged this month in anticipation of the company’s quarterly earnings report, which is scheduled for Wednesday. Analysts expect Tesla to report record earnings and positive customer sentiment due to increased sales of its Model 3, as well as increasing production efficiency at its manufacturing facilities.
An appearance from Musk
Tesla has had a rocky few months. CEO Elon Musk was recently sued for fraud, and some investors are concerned about his commitment to Tesla. However, tomorrow he is expected to make an appearance on a company earnings call in order to reassure investors that he’s still committed to the company. While it’s unclear if he will participate in all of the questions, his appearance should help ease some of those fears.
The executive went to trial in November to defend his $56 billion Tesla pay package after shareholders filed suit to rescind the deal, which they said was given unjustly to Musk, a “part-time CEO.” The jury found in favor of the executive and rejected the shareholder’s claims. While this verdict may disappoint some Tesla watchers, it is still unclear how much if any impact it will have on Musk’s compensation package.
Missed delivery estimates
Some analysts say that Tesla’s fourth-quarter deliveries may have been inflated by last-minute discounts to Model Y and 3 vehicles. Even so, Tesla managed to post some impressive numbers overall–not only setting record sales, but also delivering more vehicles than it ever has before in one quarter!
Tesla’s quarter saw a number of misses, not just in deliveries but also with targets for Model 3 production and battery packs. With Tesla hitting difficult challenges in multiple areas, analysts are likely to question the company’s viability as a business. If Tesla can’t manage to hit its delivery promises and/or hits production targets significantly lower than expected, investors may start to lose faith and pull their money out.
Apple’s iPhone sales continue to grow and are expected to top the 100 million mark within the next few months. Along with Android devices, Apple remains the world’s most popular smartphone platform. The company is expected to release new iPhone models in September that could further stimulate sales.earnings are released on October 23rd and could contain important updates on Apple’s performance.
Margins on vehicle price cuts
Tesla’s debut of the new lower price points for its Model Y and Model 3 sedans bring them more in line with mainstream vehicles in terms of pricing, qualifying them for a $7,500 federal tax credit under the Inflation Reduction Act (IRA). The threshold for electric sedans is $55,000 while that of SUVs, pickup trucks and vans is $80,000. This incentive could make Tesla’s vehicles an even more attractive choice for consumers looking to buy a new car.
Tesla has been doing a lot of cutting-edge marketing lately that includes slashing the prices of its models, but it is still not affordable for many people to buy an electric car. Tesla’s model S sedan and Model X are both too expensive to qualify for the EV tax credit which could be a deal breaker for buyers. Although Tesla has lowered prices, it might not be enough to persuade people who are on a budget or who don’t have access to good public transportation
While Tesla’s latest price slashing might be a bit too little, too late for some potential customers, it is nice that the company is continuing to discount its vehicles. The discounts might not be large, but they help bring down the price of Tesla’s cars which makes them more affordable for more people.
Analysts are closely watching Tesla’s price cuts in an effort to gauge how much demand for the company’s iconic electric cars has increased as a result. They worry that if the price cuts have shaved too deeply into Tesla’s margins, investors will become skittish and pull back from the stock. So far, though, there haven’t been any indications that this is happening. Tesla appears to be driving more customers into its stores and sales growth is still outpacing industry trends.
Updates on new gigafactories
Tesla plans to invest $3.6 billion more into its gigafactory in Nevada, but doesn’t give specifics on when the facilities might start production or break ground. This news comes as Tesla is already facing some difficulties with the factory, including a L-2 supplier not meeting quality expectations and suppliers cutting back on production due to slow demand for electric cars.
Tesla investors will want to hear about the automaker’s plans for boost production by 50%. The company has been rumored to be planning a $10 billion gigafactory in Mexico, and it is close to a deal to build factories in Indonesia.
More on the Semi and Cybertruck
Tesla’s long-awaited electric Semi finally makes its debut in December, and high-profile companies were quick to snap up the trucks. Anheuser-Busch, Pepsi, Walmart and UPS all reserved Semis so we might get some updates on production and when those companies can expect deliveries.
As Tesla continues to face delays with their much anticipated Cybertruck, the company has released a slew of new features that will make it more than just a regular truck. In July, Musk said that the truck would launch this year, but recent updates reveal that it’s still quite some way off. However, what fascinates most is not so much the end product as the various features and technologies being added onto it regularly. Waterproofing is one such addition – revealing Tesla’s intent to turn the Cybertruck into something more than just a regular truck. Other features include being able to drive in tight spaces and increased safety measures for pedestrians and other drivers alike