Tesla has released their Q3 2023 financial report and after experiencing a quarter that saw a decrease in production and deliveries and price cuts across their vehicle lineup, the company missed Wall Street expectations, but still saw growth year-over-year (YoY).
Earlier this month Tesla reported production of 430,488 units, a 10.2% decline from the previous year, and deliveries of 435,059, a drop of 6.6% from the previous quarter. These results were not unexpected though as Tesla had warned that its factories were going to experience some downtime for upgrades.
However even with the decline Tesla says it is still on track to meet their annual guidance of 1.8 million deliveries in 2023.
Here are the main financial details from Tesla’s Q3 2023 report, which you can find in full at the end of this article.
Earnings per Share
Tesla reported $0.66 non-GAAP earnings price per share in Q3, compared to a Wall Street consensus estimate of $0.73, according to LSEG (formerly Refinitiv) data. This compares to Q3 2022 when earnings were $1.05 per share on revenue of $21.45 billion.
“Our cost of goods sold per vehicle4 decreased to ~$37,500 in Q3. While production cost at our new factories remained higher than our established factories, we have implemented necessary upgrades in Q3 to enable further unit cost reductions. We continue to believe that an industry leader needs to be a cost leader.”
Revenue
With the lower volume, Tesla recorded $23.35 billion in revenue, slightly behind the $24.16 billion estimate by analysts, but ahead of Q2 2022 which saw $21.45 billion in revenue.
Profitability
Tesla posted a $1.85 billion GAAP operating income with a 7.6% operating margin. Tesla said their operating income was largely impacted by:
- – reduced ASP due to pricing and mix
– increase in operating expenses driven by Cybertruck, AI and other R&D projects
– cost of production ramp and idle cost related to factory upgrades
– negative FX impact - + growth in vehicle deliveries (despite the margin headwind from underutilization from new factories)
+ lower cost per vehicle and IRA credit benefit
+ gross profit growth in Energy Generation and Storage as well as Services and Other
+ growth in regulatory credit sales
Tesla will hold a conference call to discuss the earnings report at 4:30pm CT. This will be the first call since CFO Zachary Kirkhorn announced in August he was stepping down. He was going to remain at the company through the end of the year to support the transition, although he is unlikely to appear on the call.
Tesla (TSLA) shares ended the day down 5%, and is slightly up in after-hours trading following the release of their report.
Here is the full Q3 2023 shareholder deck.
TSLA-Q3-2023-Update-3
