Reporter of the Economic Business: Li Xing Reporter of the Economic Business Business: Pei Jianru
On October 20, the third quarter financial report of 2022 released by Tesla (TSLA, stock price 222.04, market value of 695.8 billion US dollars) showed that Tesla's total revenue in the third quarter of this year was approximately US$21.454 billion, an increase of 56% from 13.757 billion yuan in the same period last year; the net profit attributable to common shareholders was approximately US$3.292 billion, and increased by 103% year-on-year.
Image source: Tesla Financial Report
Financial Report shows that this is Tesla's 13 consecutive quarters of profit, and its operating income and operating profit have set historical records.
Net profit in the third quarter increased by 103% year-on-year
Although it achieved quarterly profits, Tesla's revenue in the third quarter of this year was lower than the previous estimate of $21.96 billion by industry analysts. After the financial report was released, Tesla's stock price fell by more than 5% after the market closed. Since the beginning of this year, Tesla's stock price has fallen by about 37%, exceeding the Nasdaq Composite Index 32%.
However, Tesla CEO Musk said in the third quarter of 2022 earnings call that in the future, Tesla's total market value has potential to exceed the total market value of Apple (AAPL, stock price of US$143.86, market value of approximately US$2.31 trillion) and oil giant Saudi Aramco (2222.SR, stock price of 35.75 Saudi Riyal , market value of 7.862 trillion Saudi Riyal, approximately US$2.12 trillion).
Image source: Sina Finance
Currently, Apple and Saudi Aramco are the top two companies in the world with market value. "To the outside world, this is an incredible combination, but in my opinion, Tesla's future value will be about twice that of Saudi Aramco." Musk said, "Now, I think Tesla can far exceed Apple's current market value."
Tesla explained that the inflation rate of raw material costs, as well as the reduction in efficiency brought about by the production climb of Berlin Gigafactory, Texas Gigafactory, and 4680 battery have all affected Tesla's profit margins.
It is worth noting that although revenue was lower than expected, Tesla's net profit in the third quarter of this year was higher than market expectations. According to the financial report, Tesla's net profit attributable to common shareholders in the third quarter of 2022 was approximately US$3.292 billion, a year-on-year increase of 103%, exceeding market expectations of US$3.19 billion.
Tesla explained that in the third quarter of this year, Tesla faced challenges such as increasing raw materials, commodity , logistics, warranty and accelerated costs, and increasing production costs of 4680 batteries, but it still achieved a significant increase in automobile delivery volume.
From the perspective of cash, Tesla's end-of-quarter cash, cash equivalents and short-term securities increased by $2.2 billion to $21.1 billion in the third quarter of 2022. "This growth is mainly due to the $3.3 billion free cash flow , partially offset by the $900 million debt repayment," Tesla said.
annual delivery volume growth rate will be slightly lower than 50%
Official data shows that from June to September 2022, Tesla's global new car production was about 365,000 units, with a delivery volume of more than 343,000 units. Among them, the delivery volume once again set a new Tesla's historical quarterly record, with a year-on-year increase of 42.4%, and increased by 34.9% month-on-month. However, this data is still lower than the 358,000 expected by Wall Street .
"At the end of each quarter, Tesla faces large-scale delivery tasks, resulting in increased transportation costs and logistics instability." Tesla explained that at present, the company's transportation costs and logistics have begun to transition to a more stable delivery rhythm.
As of now, Tesla's cumulative production is about 930,000 vehicles. In April this year, Musk said that Tesla will produce more than 1.5 million cars this year. Based on the cumulative output in the first three quarters of this year, Tesla's production capacity in the fourth quarter requires more than 570,000 vehicles to achieve this goal. "We are producing as many cars as possible," Musk said.
Tesla CFO (i.e., Chief Financial Officer) Zachary Kirkhorn stressed that while the company is tracking supply chain risks beyond control, production is still expected to achieve an annual growth rate of 50% this year.
However, in the view of Jesse Cohen, senior analyst at Investing.com, Tesla may face the challenge of adding new capacity and is likely to be unable to achieve the goal of a 50% increase in delivery volume this year.
In this regard, Zachary Kirkhorn also admitted that because the number of on-transit buses will increase by the end of the year, the annual delivery volume growth rate is expected to be slightly lower than 50%.
"For the foreseeable future, we expect car delivery to continue to grow, achieving an average annual growth of 50%, but the growth rate also depends on equipment capacity, factory uptime, operational efficiency, and supply chain capabilities and stability." Musk said.
Image source: Image provided by the company
Tesla explained that the company is focusing on increasing weekly output of factories in Fremont and Shanghai, as well as the capacity of the Gigafactories in Berlin and Texas, to increase automobile production as soon as possible.
As of now, the production speed of the Texas Super Factory has begun to achieve continuous growth month by month, and the production efficiency of the Berlin Super Factory has also increased significantly at the end of the third quarter, with a single weekly production capacity of more than 2,000 vehicles. "We are continuing to implement solutions to further increase the output of the Fremont Gigafactory." Musk said that the total production of Tesla's 4680 battery cells (the battery cells sent to be distilled) has increased by three times month-on-month .
Musk also announced that the first phase of Tesla electric truck Semi delivery plan will be launched on December 1, 2022.
Daily Economic News
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