Copyright © BusinessAMBE 2023
The numbers in a row:
- Revenue clocked in at
$25.2 billion in the fourth quarter, or 3 percent more than a year earlier. However, sales from the pure automotive business grew only 1 percent, to$21.6 billion . -
Net profit, excluding extraordinary items, fell 39 percent in the quarter, to
$2.48 billion . Earnings per share fell 40 percent, to71 cents . Analysts had previously counted on some73 cents .
What's up: The automaker points to the effect of "pricing and product mix." That's a reference to the price cuts
- The lower average price could only be partially offset by the increase in the number of vehicles delivered, causing sales to grow more slowly than expected.
- Profitability is also under pressure from operating costs for research projects, including around AI. The production start of the much-discussed Cybertruck is also chasing costs higher.
-
These higher costs outweighed favorable effects, such as the drop in raw material costs and tax breaks thanks to
President Biden's Inflation Reduction Act, though anything but a great friend of CEOElon Musk .
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Zooming out: Over a longer period of time,
- But competition, including from Chinese giant BYD, is increasing in the electric car market.
-
Important:
Tesla predicts that volume growth for cars will be less this year than in 2023 because it is in transition to a new technology car-building platform at its Texas Gigafactory. -
CEO
Elon Musk has stressed repeatedly that investors should not viewTesla purely as a car builder. The company predicts that the fast-growing business around energy storage will grow much faster than the car business by 2024, just as it has in recent years.
👉 "Our company is currently between two major growth waves: the first began with the global expansion of the Model 3/Y platform. We believe the next one will be deployed through the global expansion of our next-generation vehicle platform,"
Initial stock market reaction:
© The Content Exchange, source