Record sales: Tesla boosts profit by more than four times in Q3

Electric vehicle maker Tesla managed to post record third-quarter profits despite logistical problems hampering its production lines, but warned that its ramp-up would depend on the availability of certain components.

“A variety of challenges, from semiconductor shortages to port congestion to power outages, have impacted our ability to run factories at full capacity,” the company acknowledged in a statement.

However, Tesla managed to deliver an unprecedented 241,300 vehicles worldwide over the period, a figure up 20% from the previous quarter, 76% year-on-year.

The ramp-up of its Shanghai plant has largely contributed to this, with vehicles manufactured in China being exported to the United States and Europe, said Chief Financial Officer Zach Kirkhorn during a conference call.

Elon Musk had previously said he was able to work around much of the semiconductor shortage by using new chip designs and rewriting software accordingly.

Other manufacturers are having a harder time dealing with these challenges, with General Motors, for example, seeing its U.S. vehicle sales drop 33% in the third quarter due to the semiconductor shortage that has forced it to cut production since the beginning of the year.

Tesla is on track to meet its goal of 50% annual growth but production in the fourth quarter, but that “will depend a lot on the availability of certain components,” Kirkhorn said.

The company’s announcement that its growth will be dependent on external factors “may have left some investors pensive,” noted CFRA’s Garrett Nelson to justify the stock’s reaction Wednesday, which was down 0.7% after the Wall Street session despite better-than-expected numbers.

But it is up 23% since the beginning of the year, after jumping more than 700% in 2020.

 

Bitcoin loser

Tesla’s revenue hit $13.76 billion between July and September, up 57%.

The company’s net income jumped to $1.6 billion in the period from $331 million a year earlier.

The increase in operating income is “mainly related to the growth in vehicle volume and cost reduction,” said Tesla.

The group has thus managed to increase the gross margin from its automotive business to 30.5%, compared to 28.4% in the previous quarter.

The company, which recently announced the move of its headquarters from California to Texas, still aims to start production in its new factories in Austin and Berlin by the end of the year, Kirkhorn said.

The goal, the chief financial officer said repeatedly Wednesday, is to ramp up production to meet strong demand for electric vehicles.

Tesla, which had created the surprise at the beginning of the year by announcing to have bought for 1,5 billion dollars of bitcoin, on the other hand saw again this investment to weigh on its results.

After earning $101 million in the first quarter thanks to the virtual currency, the group had to record a charge of $23 million in the second quarter and $51 billion in the third.

The group, which has long derived a large part of its profits from the sale of carbon credits to other companies because its cars do not emit emissions, continues to see this source dry up: revenues generated by these operations reached $279 million in the third quarter, compared with $354 million in the second quarter and $518 million in the first.

As he had hinted in July, the whimsical Tesla boss did not participate Wednesday in the conference call with analysts.

Elon Musk had indicated at the time that he would not necessarily participate in this meeting that traditionally follows the release of results, “unless there is something really important that I want to say.