Tesla shares climbed more than 5% on Monday, following a report by Bloomberg. The news came a day after Elon Musk, was named as a co-head of the incoming administration's government efficiency department, Tesla has surged around 28% since Trump emerged victorious.
Tesla delivered robust Q3 results, highlighted by record vehicle deliveries, strong revenue growth, and operational efficiency improvements. The company achieved an 8% YoY increase in revenue to $25.2B, driven by continued expansion across its vehicle and energy businesses. Operating income grew to $2.7B, reflecting a 10.8% margin, despite a challenging macroeconomic environment. Cash and investments rose to $33.6B, with positive free cash flow of $2.7B contributing to the sequential $2.9B increase.
Vehicle deliveries grew both sequentially and YoY, supported by record-low cost of goods sold (COGS) per vehicle at ~$35,100. Notably, the refreshed Model 3 ramped up production with reduced costs, while Cybertruck production achieved a positive gross margin. Tesla’s Shanghai facility hit key milestones, producing its 3-millionth vehicle and exporting its 1-millionth, while Gigafactory Berlin-Brandenburg and Shanghai continued to lower COGS sequentially. Model Y remains a global bestseller, topping sales charts in multiple European countries and achieving milestone status in Norway. Tesla’s energy business also posted strong results, with record gross margins and increased production. The Megafactory in Lathrop achieved a weekly production rate of 200 Megapacks, while Powerwall deployments reached new highs, bolstered by the ramp-up of Powerwall 3. Energy storage deployments are projected to more than double YoY in 2024, underscoring the segment’s growth potential.
The company remains strategically focused on making electric vehicles (EVs) affordable and accessible. Tesla is preparing for the launch of new, more affordable vehicle models in 2025, aimed at lowering the total cost of ownership per mile and further accelerating EV adoption. These vehicles will integrate next-generation platform features while leveraging existing manufacturing lines, enabling prudent growth with reduced capital expenditure. Tesla estimates production capacity near three million vehicles annually, positioning it for more than 50% growth over 2023 levels before requiring new manufacturing investments. Autonomy and software remain critical pillars of Tesla’s long-term strategy. At the recent “We, Robot” event, Tesla outlined plans for autonomous transport offerings with costs per mile lower than traditional rideshare, personal vehicle ownership, and even public transit. AI and fleet-based revenue streams are expected to supplement hardware-driven profits over time. Despite macroeconomic headwinds and reduced EV investments by competitors, Tesla remains resilient. The company is balancing cost reduction initiatives with investments in AI, production capacity, and expanded product offerings. Its financial position, bolstered by strong liquidity, ensures it can fund its ambitious roadmap and maintain a robust balance sheet.
Looking ahead, Tesla expects modest growth in vehicle deliveries in 2024, driven by expanded production and a diversified lineup. Energy deployments are poised for significant growth, while ongoing cost efficiencies and innovation will enhance profitability. Management remains committed to balancing growth with shareholder value creation, emphasizing disciplined capital allocation and strategic adaptability in uncertain times. Tesla is well-positioned to capitalize on its next growth wave, leveraging advances in autonomy, cost-efficient manufacturing, and product diversification to drive sustainable long-term value.
.Source: Company’s Report
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