Tesla reports decent results. EPS reaches $1.19, operating profit hit $3.9bn

EXMO.COM analyst: Currently, Tesla is still trying to conquer the market by prioritising revenue over profit

Elon Musk 's company showed good, and sometimes record-breaking results. Overall, it did not disappoint analysts.

The Q4 2022 report was touted by the media as the most important earnings release in Tesla's history. And it turns out that it was very successful, just like the whole of 2022. In the fourth quarter of last year Tesla generated the highest quarterly revenue in history, as well as operating profit and net profit. Throughout 2022, Tesla's revenue grew 51% y/y to $81.5 billion, and profit doubled to $12.6 billion.

Importantly, the results of Elon Musk's company generally did not disappoint analysts. Earnings per share for the fourth quarter was $1.19, versus analysts' expectations of $1.13. Operating profit reached $3.9 billion, up from $3.7 billion in the third quarter, and analysts expected $4.2 billion.

Tesla maintains margins, focuses on cost reduction

Tesla's operating margin was 16.8% in full-year 2022, 16% in Q4 alone. Operating profit in the entire 2022 amounted to USD 13.7 billion, and in the fourth quarter alone USD 3.9 billion.

Tesla's operating margin compared to the automotive industry and S&P500

 

Source: company

However, the results for the first quarter do not have to be so great . Recall that in early 2023, Tesla dramatically reduced the prices of its EVs around the world. Why? Due to the gloomy macroeconomic environment, which has created uncertainty around the demand for expensive electric cars and doubts about the stability of Tesla's profit margin.

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“As we enter 2023, we are aware of unfavorable macroeconomic conditions. However, our team is used to challenges. We are accelerating cost reduction and want to increase production efficiency,” Tesla wrote in the report.

Tesla - financial results on an annual basis 

Source: company

Tesla produces and delivers more and more cars

In 2022, Tesla delivered a record 1.31 million cars to customers (an increase of 40% y/y). It produced 1.37 million vehicles, 47% more than in 2021.

Tesla plans to produce 1.8 million cars this year. Wall Street expected 1.9 million units. Tesla assures that in the coming years it has a plan to increase production at an average annual rate of 50%. She also assured that production of the Cybertruck at Gigafactory Texas should begin this year.

Interestingly, last year Tesla has significantly increased the number of vehicle charging stations. It went up by 35% y/y to 4.7k.

Tesla - operational data (annual basis)

Source: company

EXMO.COM analyst: Currently, Tesla is still trying to conquer the market by prioritising revenue over profit

Pawel Zapolski

FXMAG Writer