In the early hours of this morning, Tesla released its 2022 first quarter earnings report.
According to the financial report data, Tesla has achieved profitability for 11 consecutive quarters. In the middle of the quarter, Tesla withstood multiple pressures such as supply chain challenges, broke out of strong vitality, and became a strong agent for economic recovery.
Revenue net profit increased significantly
Specifically, in the context of supply chain bottlenecks, Tesla still produced more than 305,000 vehicles in the first quarter and delivered more than 310,000 vehicles. Tesla's total revenue for the first quarter was $18.76 billion, up 81% year-over-year, about $1 billion higher than Wall Street's expectations, gross profit was $5.46 billion, up 147% year-over-year, gross margin was 29.1%, adjusted EBITDA was $5.023 billion, up 173% year-over-year, operating profit was $3.6 billion, up 507% year-over-year, and operating margin was 19.2% Net profit attributable to common shareholders was $3.32 billion, up 658% year-over-year; earnings per share attributable to common shareholders were $2.86, up 633% year-over-year; and free cash flow was $2.23 billion.
Among them, the revenue of Tesla's automotive business climbed 87% year-on-year to $16.86 billion; the gross profit of the automotive business was $5.54 billion, an increase of 132% year-on-year, and the gross profit margin was as high as 32.9%. Among them, the sale of regulatory points contributed $680 million in revenue to Tesla, up 31% from the same period last year.
In addition, Tesla's "war readiness funds" are increasing. The company achieved $17.5 billion in cash and cash equivalents in the first three months of this year, while the company continued to reduce its debt burden, which was less than $100 million at the end of the quarter, excluding financing for automotive and energy products.
Since the outbreak of the pandemic, Tesla seems to have been an "outsider" in the face of competitors caught in global supply chain chaos and frequent shutdowns, releasing record deliveries and earnings for several consecutive quarters, not only due to the continuous growth in deliveries, but also due to Tesla's timely increase in the average selling price of vehicles, while cutting the average cost per vehicle. Tesla's average pretax profit per vehicle increased by more than 60 percent in the first quarter to $16,203 compared to the same period last year.
However, Tesla also admitted that the company's production is still constrained by the shortage of key components, factories have been operating below capacity for several consecutive quarters, while rising raw materials, logistics and operating costs are also constraints, and this situation may continue until the end of 2022.
Expansion of production capacity
Tesla said that in addition to the impact of the chip shortage, the recent outbreak of the new crown pneumonia epidemic has also put pressure on its supply chain and factory operations, and the company has invested a lot of energy in independent battery cell production, raw material procurement and supplier diversification.
Affected by the epidemic in Shanghai, its super factory in the Shanghai Lingang Free Trade Zone has been out of production for nearly three weeks since March 28, and has officially resumed work and production on April 19.
It is worth noting that the weekly production capacity of Tesla Shanghai Gigafactory in the first quarter is still strong, and it has resumed work in an orderly and scientific manner after a short suspension of production recently, and the current production capacity is steadily climbing to ensure the supply of domestic and foreign products.
With the support of Shanghai and local governments, More than 100 parts manufacturers at Tesla are gradually working together to resume work and production and smooth logistics. Many Tesla parts suppliers in Shanghai began to resume work, becoming the region with the largest proportion of Tesla supplier partners resuming work and production.
Tesla CEO Musk said on the earnings call that this year, Tesla will achieve a 60% growth rate in delivery, and still has confidence in achieving an average annual delivery of 50% growth over many years.
With the start of production and delivery at the Texas Gigafactory and the Berlin-Brandenburg Gigafactory, Tesla's global production capacity has also been significantly increased. A new report from Germany's Automobilwoche says Tesla aims to ramp up production to 1,000 units a week by the end of this month. Morgan Stanley analyst Adam Jonas expects Tesla to deliver 1.46 million vehicles in fiscal 2022, up 56 percent from 2021.
With two new plants on stream, Tesla will be able to meet the growing demand for cars. But at this stage, all three factories are trying to achieve capacity ramp-up, which will take time, and the speed of the ramp-up will be closely related to the speed of introduction of new products, factory production technology and ongoing supply chain bottlenecks.
In addition to the performance and production status that the market is most concerned about, Tesla also revealed its progress in the business of autonomous driving and robo-taxi. According to Tesla, the company is developing a customized Robo Taxi self-driving taxi that will neither configure the steering wheel nor install foot pedals. Tesla hopes to achieve mass production of Robo Taxi in 2024, which will become a "huge driving force" for Tesla's growth.
In terms of autopilot, Tesla said that the company will continue to develop a beta version of full autopilot software, and there will be 7 software upgrades this year. At the same time, the company will continue to study ways to reduce autonomous driving detachments, especially focusing on unprotected left turns and smooth driving by reducing deceleration.
In the coming years, Tesla expects vehicle deliveries to grow by an average of 50 percent a year, and in some years it may grow even faster, depending on factory capacity, operational efficiency, and supply chain stability. Tesla's sales growth is likely to reach 60 percent this year, meaning the company delivers about 1.5 million units this year.
Musk added that Tesla aims to produce 20 million cars a year by the end of the century (2090s). Even today, Tesla has accomplished 5 percent of that goal.