Tesla: net profit jumped in the second quarter, forecast confirmed

The American manufacturer of electric vehicles Tesla announced Wednesday higher results, in the wake of sales boosted by price reductions practiced for several months.

As analysts expected, these price cuts eroded the profit margin of Elon Musk’s group, which slipped to 18.2%, against 19.3% in the first quarter.

The billionaire had exposed his strategy in April: it is better to sell more even if the margins are temporarily lower.

“It’s better to deliver a lot of cars with a lower margin and reap that margin later as we perfect” self-driving software, he explained.

Deliveries rose to 466,140 vehicles over the quarter, from 254,695 a year earlier.

“We are delighted to have achieved such results given the macroeconomic environment in which we currently find ourselves,” the group said in its earnings release. “We plan to ramp up production as quickly as possible.”

“For 2023, we hope to be ahead (of our forecasts) with around 1.8 million vehicles over the year,” he confirmed.

– “Position of strength” –

Net income jumped 20% in the second quarter to $2.7 billion.

Tesla stock rose 0.24% to $292.28 in post-Wall Street trading.

“We have ample cash on hand to fund our product program, long-term plant capacity expansion plans and other expenses,” the automaker said.

The group’s turnover amounted to 24.92 billion (+47%). It benefited from the increase in deliveries and growth in the group’s other branches, but was affected by a fall in the average selling price and by unfavorable exchange rates.

Tesla made 479,700 vehicles in the second quarter, compared to 258,580 in the same period of 2022 and 440,808 in the first quarter of this year.

For Wedbush analysts, Tesla is now “in a strong position” in the electric vehicle market thanks to “its aggressive pricing policy”. The group “is now preparing to further monetize this achievement”, they commented.

They are now waiting to hear Elon Musk’s forecasts and comments, including on the possibility of additional tariff reductions.

– Satisfactory margin –

The group was satisfied with the level of its operating margin, which remained “healthy” at around 10% “despite the price reductions in the first and second quarters”.

“This reflects our continued efforts to reduce costs, the success of the production lines in Berlin and Texas and the good performance of our Energy and Services branches” in particular.

Regarding the Cybertruck electric pickup, the first copy of which left the production line of the Tesla mega-factory in Texas (southern United States) on Saturday, the group said on Wednesday that the start of large-scale production would take place, as planned, by the end of the year.

The machine with a futuristic silhouette, dressed in a kind of metal shell with rather unusual angular lines, was unveiled in November 2019.

Two days after the vehicle’s big show, Tesla said it had received nearly 150,000 pre-orders. The group has given no indication on this subject since, nor concerning the sale price.

When it was launched, the company indicated that the Cybertruck – which can go from 0 to 100 km / h in less than three seconds, according to the Tesla site – was to be available in three models, 39,900 dollars and 400 km of autonomy for the entry level, up to 69,900 dollars and 800 km of autonomy announced for the higher model.

He will find himself in competition with the electric pickup from Ford, which also announced Monday a drop of 10,000 dollars in the selling price of its F-150 Lightning.