(Stock ticker: TSLA), on Wednesday evening, reported fourth-quarter earnings per share of $1.19 on sales of $24.3 billion. Operating profit was $3.9 billion, up from the previous record: $3.7 billion in the third quarter.
Wall Street was looking for earnings per share of about $1.13 and operating profit of $4.2 billion on $24.7 billion in sales.
Free cash flow for the quarter was $1.4 billion. Analysts expected $2.7 billion.
Looking ahead, Tesla said it plans to produce 1.8 million units in 2023. The Street is looking at about 1.9 million units.
It’s a good report. Shares rose 3.8% in after-hours trading shortly after the results were announced. Tesla shares closed up 0.4 percent at $144.43 in Wednesday’s trading. the Standard & Poor’s 500 And Dow Jones Industrial Average Both are flat on the day.
Investors can expect the stock to move after the company’s earnings conference call, which starts on… 5:30 p.m. ET. Investors will be looking for feedback on production, profit margins, electric vehicle competition and new products. They will want an update on everything.
This is breaking news. Read a preview of the earnings report below.
Earnings reports from Tesla are always events to watch for investors, and the upcoming fourth quarter for the EV pioneer Report Wednesday afternoons are no exception. In fact, it may be the most important Earnings report in the company’s history.
There have been other “more important” players in the company’s past. In 2010, Tesla (Stock ticker: TSLA) reported its first full quarter as a publicly traded company, producing about $31 million in sales From the original Roadster. There were quarters when the EV pioneer began delivering the Model S—its first mass-produced vehicle—in 2012, and the lower-priced Model 3 in 2017.
There was also Third quarter of 2019, when Tesla made a windfall. In the three years leading up to that period, Tesla lost about $2.5 billion in operating profit and used more than $5 billion in total cash. Since then, Tesla has generated nearly $19 billion in operating profit and $15 billion in free cash flow cumulatively.
There is an argument that the upcoming fourth quarter report outperforms all of those.
It is now the most Trade actively Stocks are in the US market, but they are facing a tougher economic environment, with higher interest rates, higher inflation, and recession fears. In addition, the competition for electric cars continues to grow, and investors are also concerned about CEO Elon Musk’s new role as owner of the social networking platform Twitter.
“After achieving unprecedented hyper-growth over the past few years in the electric vehicle market that Musk essentially pioneered… Tesla faces an even darker macro in 2023,” Dan Ives, an analyst at Wedbush, wrote in a report Tuesday.
Ivis is a Tesla bull, rating stock buy. His price target is $175 a share.
Tesla in a big way Reducing the prices of its electric vehicles around the world at the beginning of 2023 amid that dismal macroeconomic backdrop, which created fear and uncertainty about the demand for electric vehicles and Tesla profit margins.
For 2022, Tesla will generate gross margins of about 26% from its auto business, based on the first three quarters of the year and Wall Street consensus estimates. For the full year 2023, after the price cuts, the forecast for auto gross margins drops anywhere from 17% to 22%. Operating profit estimates for 2023 now range from about $9 billion to $30 billion, according to FactSet.
That’s a wide range, even for Tesla, and means the stock should face a lot of volatility in 2023. The $21 billion range for operating profit forecasts is about 140% of the $15 billion median estimate. At the start of 2022, the estimated range is around $13 billion, or about 100% of the median estimate.
When Tesla reports on Wednesday after the market closes, investors will want an update on profit margins as well as production and sales. They’ll also want to know how the year turned out.
Wall Street expects earnings per share of about $1.13 from $24.7 billion in fourth-quarter sales. Operating profit and free cash flow are expected to be $4.2 billion and $2.7 billion, respectively.
Tesla generated $1.05 per share on sales of $21.5 billion in the third quarter of 2022. Operating profit and free cash flow were approximately $3.7 billion and $3.3 billion, respectively.
Whatever Tesla reports, investors should be prepared for trading volatility. Options markets It means the stock will move about 10%, up or down, after the earnings report. Shares have moved an average of about 8%, up or down, following the past four quarterly reports. Stocks rose twice and fell twice during this range.
Tesla stock has had a strong start to the year, up about 13% year-to-date. The S&P 500 and Dow Jones Industrial Average rose about 3% and 6%, respectively.
Tesla stock fell 3.4% in early trading Wednesday. the
Write to Al Root at [email protected]
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