Tesla beats earnings estimates and maintains 50 percent target for production growth

Tesla Inc. chief executive officer Elon Musk said the electric vehicle maker has been through “supply chain hell” but sees falling commodity prices and signaled optimism the company could post record volumes later in the year.

The comments came after the electric vehicle leader reported second-quarter earnings that beat Wall Street estimates, reflecting Tesla’s progress in restarting production while overcoming supply chain hurdles and Covid lockdowns at its factory in China.

“We have potential for a record-breaking second half,” Musk said in a call to analysts on Wednesday, noting strong June production at the company’s California and Shanghai factories. However, he warned that the industry faces major challenges to ensure an adequate supply of parts and materials.

“It’s been a supply chain hell of sorts for several years,” Musk said.

The Tesla CEO sees signs that commodity prices are on a downtrend and projected inflation will slow by the end of the year.

The company’s shares rose 0.8% to $748.55 as of 6:26 p.m. New York. The stock had fallen 30 percent this year by the close of trading in New York on Wednesday.

As the first major U.S. automaker to report second-quarter financial results, Tesla said in a letter to shareholders that ramping up production at its two newest plants — one in Germany and the other in Texas — relies on the smooth launch of new vehicles will depend on improved supply chains.

The Austin, Texas-based manufacturer left its production forecast unchanged for compound annual growth of 50% “over a multi-year horizon,” but said problems ranging from supply and labor shortages to logistical problems caused it its factories haven’t been running at full capacity lately.

“They are maintaining their 50 percent growth rate, which is a bit of a surprise. I thought they might pull out of it,” said Loup Ventures’ Gene Munster. “You are doing a good job in a difficult environment.”

Tesla posted adjusted earnings of $2.27 per share, beating the average analyst estimate of $1.83 per share compiled by Bloomberg. But that was less than the $3.22 Tesla earned in the first quarter, marking its first consecutive earnings decline since late 2020.

Analysts are watching closely for how quickly Tesla can ramp up production of its mass-market Model Y SUV from these two factories, as well as unveil the long-awaited Cybertruck pickup in Austin. Musk told analysts on the call that Tesla was on track to launch the truck in mid-2023, saying it could be “our best product ever.”

Tesla previously said it delivered 254,695 vehicles worldwide in the quarter, up 27 percent year over year but down from its record 310,048 in the first quarter. It was the first time in two years that the company failed to increase vehicle deliveries from the previous quarter. In April, Musk predicted that the company would produce more than 1.5 million vehicles this year. Tesla had earned about 564,000 in the first half.

The electric vehicle maker’s revenue came in at $16.9 billion, in line with the average of the estimates. Revenue from the sale of regulatory credit totaled $344 million compared to $679 million in the first quarter.

Calling Tesla’s digital currency game “a sideshow to a sideshow,” Musk said Telsa was open to increasing its holdings of cryptocurrencies even after reporting a bitcoin depreciation that hurt second-quarter gains.

Tesla converted about 75 percent of its Bitcoin purchases into fiat currency, but the CEO explained the move as a way to increase liquidity amid uncertainty over the length of China’s Covid-related shutdowns. It should not be taken as “a judgment on Bitcoin,” he said.

https://www.independent.ie/business/world/tesla-beats-profit-estimates-and-keeps-50pc-target-for-output-growth-41856778.html Tesla beats earnings estimates and maintains 50 percent target for production growth

Fry Electronics Team

Fry Electronics.com is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – admin@fry-electronics.com. The content will be deleted within 24 hours.

Related Articles

Back to top button