Tesla stock (TSLA) fell more than 12% on Thursday after the company reported weaker-than-expected fourth-quarter results late Wednesday and also lowered its full-year production outlook.
For the fourth quarter, Tesla reported revenue of $25.17 billion, compared to expectations of $25.87 billion. Sales increased approximately 3% compared to the same period last year. Tesla reported adjusted EPS of $0.71 versus expectations of $0.73. Adjusted net income was $2.48 billion, compared to street expectations of $2.61 billion.
Regarding full-year production, Tesla said, “Vehicle volume growth is likely to be significantly lower than the growth rate achieved in 2023 as our teams work to launch next-generation vehicles at Gigafactory Texas. “There are 2.19 million people on the streets in 2024, which was expected to be an increase of 21% from 2023.
CEO Elon Musk has confirmed that the company's next-generation car will arrive in late 2025.
Tesla also mentioned progress on its next-generation manufacturing platform during its earnings release and subsequent earnings call.
“We plan to begin production at Gigafactory Texas and are focused on bringing our next-generation platform to market as quickly as possible,” the company said in a statement. “This platform will revolutionize the way vehicles are manufactured.”
“The development of the next generation of low-cost cars is very advanced, and I'm really excited about it. This is a revolutionary manufacturing system, far more advanced than any other system in the world,” Musk said during an earnings call. “There is,” he said. The company's current schedule puts the vehicle into production in the second half of 2025. This is in line with a Reuters report earlier Wednesday that Tesla told suppliers it hopes to begin production of a new mass-market EV, codenamed “Redwood,” in mid-2025. 2025.
Tesla's declining profitability is likely due to lower profit margins since Tesla began its cost-cutting efforts in late 2022. Tesla reported fourth-quarter gross margin of 17.6% compared to an estimated 18.1%, which is a significant decline compared to a year ago and a significant quarter-over-quarter decline. Ta. That was down from the 17.9% achieved in the third quarter.
Headlines include rental car company Hertz cutting thousands of EVs, Tesla cutting prices in China, two-week production halt in Berlin, and CEO Elon Musk's untimely request for more inventory. It became a burden.
Tesla reported earlier this month that it delivered 484,507 vehicles in the fourth quarter, beating street expectations of 483,173, according to Bloomberg. The numbers represent Tesla's best quarter ever, surpassing the all-time high of 466,000 deliveries in the second quarter of last year by nearly 20,000 units.
Tesla announced that its annual car deliveries were 1.81 million units, an increase of 38% from the previous year, and production was 1.85 million units, an increase of 35% from the previous year. The 38% shipment growth rate was below the company's 50% compound annual growth rate (CAGR) target, which Tesla previously said was not achievable due to factory closures and improvements that occurred in the third quarter.
Delivery by Cybertruck is also noteworthy. Tesla did not disclose this total in its fourth-quarter delivery update, but the company said the Cybertruck will take longer to begin production than other models.
”[Cybertruck] Demand is out of the question,” Musk said on the conference call, repeating comments from last year.
Musk also referenced comments he made last week in which he argued that the company needs to secure greater control over Tesla if it is to achieve its broader AI ambitions.
Musk said at an earnings conference that given his current shareholdings, his influence will be very small in the future, and there is a possibility that major shareholders will take away control or make the wrong decisions. He said he was concerned that there might be.
“I could be voted out of office by a random shareholder advisory firm,” he said, citing Institutional Shareholder Services (ISS) and Glass Lewis, the two largest shareholder advisory firms, as examples. Stated.
”[A] “Many activists have infiltrated shareholder rights groups,” Musk said, adding, “I'm not looking for additional economics. I just want to be an effective steward of powerful technology.”
Pras Subramanian is a reporter for Yahoo Finance.you can follow him twitter And even more Instagram.
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