Tesla soars after earnings surprise

Following yesterday’s earnings call, shareholders of Tesla stock are pleased to see a “comeback” after a troublesome few months. Shares surged over 10% within the morning and proceed to trade with high volume consequently of the electrical carmaker’s earnings beat and rosy outlook for 2023.

Above: Tesla’s stamping presses at Gigafactory Shanghai (Source: Tesla)

Let’s take a have a look at seven key takeaways from the Tesla’s fourth quarter shareholder letter and earnings call yesterday.

1. 2022 was a ‘improbable’ yr

Elon Musk explained, “It was a improbable yr for Tesla. It was our greatest yr ever on every level… in 2022, we delivered over 1.3 million cars and achieved a 17% operating margin, the best amongst any volume carmaker, I believe perhaps amongst any carmaker.”

CFO Zach Kirkhorn reflected on the past yr’s accomplishments: “On a full yr basis, revenue increased over 50%, operating income doubled, free money flows increased over 50%, and our margins remained industry-leading.” As well as to the vehicle side of the business, he added that “the energy business had its strongest yr yet across all metrics.”

2. Demand is surging in 2023

Musk noted that after Tesla’s recent price drops, “Demand far exceeds production… we have seen the strongest orders year-to-date than ever in our history. We currently are seeing orders at almost twice the speed of production.”

3. Understanding the worth of full self-driving 

Regarding Full Self-Driving, Musk notes: “each time we sell a automobile, it has the power, just from uploading software, to have full self-driving enabled… After which, when it becomes fully autonomous, that may be a value increase within the fleet. Which may [turn out to] be the most important asset value increase of anything in history.”

4. Cybertruck is coming 

Musk commented that Cybertruck production will start slowly: “sometime this summer… [and] won’t be a big contributor to the underside line, but it’s going to be next yr. So it’s an incredible product. I can not wait to drive it personally. It should be the automobile that I drive day by day.”

5. An upbeat forecast

In keeping with Musk, vehicle production should range somewhere between 1.8 million and a couple of million: “our internal production potential is definitely closer to 2 million vehicles, but we were saying 1.8 million… so if it is a smooth yr, actually, without some big supply chain interruption or massive problem, we even have the potential to do 2 million cars this yr.”

6. Tesla’s vehicle roadmap is ‘exciting’

With future vehicles, Musk teased: “now we have other products in development. We’re not going to announce them, obviously, but they’re very exciting. And I believe it’s going to blow people’s minds once we reveal them. Tesla has probably the most exciting product road map of any company on earth by an extended shot.” More will likely be shared on March 1st during Tesla’s upcoming Investor Day.

7. Shareholders should expect growth

Regarding the longer term for the stock, Musk predicts: “there’s going to be bumps along the way in which… But long run, I’m convinced that Tesla will likely be the Most worthy company on earth.”

While it’s difficult to predict what’s coming, if we leaf through the rear view mirror, it’s clear that Tesla’s experienced some impressive growth as evidenced within the charts below (courtesy of Yahoo Finance).

Above: A have a look at Tesla’s performance from 2016 -2022 (Charts: Yahoo Finance)

If these trends proceed, shareholders might need to buckle in for a fast-paced, exciting road ahead.

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Source: Tesla; Charts: Yahoo Finance