Tesla Q1 2024 Earnings Reveal Strategic Gains Amid Financial Challenges

Tesla has published their first-quarter earnings for 2024, revealing a mix of strategic advancements but also financial challenges.

Financially, Tesla reported a decrease in total revenue to $21.3 billion, marking a 9% drop year-over-year (YoY). This decline was primarily driven by a reduction in the average selling price (ASP) of vehicles, despite increases in other parts of the company’s business, as well as Full Self-Driving (FSD) revenue recognition.

The company’s net income stood at $1.1 billion GAAP and $1.5 billion non-GAAP, also down 55% and 48% respectively from the previous year. Tesla mainly attributed to these drops to lower vehicle deliveries and higher operational costs.

A major highlight from the quarter was the production milestone achieved with the Cybertruck, as Tesla reported producing over 1,000 units in a single week in April.

The quarter was also marked by operational hurdles, including disruptions at the Fremont factory, Giga Berlin, and Giga Shanghai. The former from transitioning the Model 3 production line to the new design, and the latter suffering from an arson attack and the repercussions of the Red Sea conflict. Giga Shanghai also saw reduced output due to planned shutdowns for Chinese New Year.

Tesla’s free cash flow was reported at -$2.5 billion, largely due to a substantial $1.0 billion capital expenditure on AI infrastructure. The company increased its AI training compute capacity by more than 130% and continued the rollout of FSD with new features like Autopark.

Credit: Tesla

On a positive note, Tesla’s energy storage and services sectors showed promising growth. Energy storage deployment reached a record 4.1 GWh, with revenue in this segment growing 7% year-over-year. Similarly, the Services and Other revenue grew by 25%, although the gross profit in this segment declined due to lower profits from used vehicle sales.

Credit: Tesla

Tesla will discuss these financial results and more at the earnings call, scheduled for 4:30pm CT (5:30pm ET/2:30pm PT).

You can read the full shareholder deck below.

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