Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Tesla cracks the $1 billion profit mark

Tesla cracks the $1 billion profit mark

Tesla posted record profits Monday - its third record quarter in a row - as its adjusted earnings reached the $1 billion mark for the first time.
The company recorded $9 billion in total revenue. That was slightly lower than fourth quarter sales but up 75% from the year-earlier period.

Revenue was partly held back as it stopped building its two most expensive models, the Model S and Model X, during the quarter, as it prepared to roll out new versions of those vehicles and dealt with a shortage of computer chips that has dogged the entire auto industry.

But Tesla said it weathered the chip shortage "in part by pivoting extremely quickly to new microcontrollers, while simultaneously developing firmware for new chips made by new suppliers." CEO Elon Musk told investors later Monday that the chip shortage was "a huge problem" for Tesla, and that the company "had some of the most difficult supply chain challenges that we've ever experienced."

Shares of the company fell 3% in premarket trading.

It said its deliveries of the new Model S "should start very shortly." But that was the same prediction made when it reported fourth-quarter results three months ago. Musk again seemed more cautious than the company's earnings statement, saying that it had experienced "just a lot of issues" with the new Model S and Model X. He said deliveries of the Model S would resume deliveries "probably next month," and that volume deliveries of the two cars would not resume until the third quarter.

The company was also helped by an investment in bitcoin. The company had previously disclosed it invested $1.5 billion in bitcoin in the quarter with some of its cash on hand. It said the sale of bitcoin during the period resulted in a $101 million profit.

It wasn't long ago that Tesla was losing money most quarters and in danger of running out of cash. It didn't report consecutive profitable quarters until the end of 2018, and it proceeded to lose money again over the first half of 2019.

But it has been profitable since the third quarter of 2019, and the stock has soared since then, climbing 1349% since it reported that third quarter profit in 2019. It is one of the nation's most valuable companies and its stock is worth more than the combined value of the world's seven largest automakers.

And its adjusted earnings in the first quarter could top that of some established automakers, such as Ford (F), according to analysts' forecasts, even though Ford sells far more cars.

Musk said the company should be able to stick to its target for better than 50% growth in sales this year, which would take sales over the 750,000 mark, and that it would be able to continue 50% sales growth annually beyond that. It has plants under construction in Texas and Germany, although he cautioned Monday that he expects only initial limited production from those factories this year. He said the two plants won't have volume production until 2022.

Musk and other Tesla executives defended the company's Autopilot feature that has been the focus of a recent fatal crash of a Tesla in a Houston suburb in which police said that investigators were certain that no one was in the driver's seat at the time of the crash.

Lars Moravy, Tesla's vice president of vehicle engineering, said the company is working with federal safety investigators and local police. He said that because the steering wheel was "deformed" it is now believed there was in fact someone in the driver's seat at the time of the crash. And he did caution "further investigation of the vehicle and accident remains."

Musk said that the company is making great progress on developing fully self driving cars, and the he believes it will be the key factor distinguishing it from other companies.

"Right now, people think of Tesla as a car company or energy company. I think long term, people will think of Tesla as much as an AI [artificial intelligence] robotics company as we are a car company or an energy company," he said. "I think we are developing one of the strongest hardware and software AI teams in the world."

Some critics of Tesla have questioned the strength of its earnings, pointing to the fact that its "adjusted" earnings excludes some costs such as stock compensation.

But many companies report adjusted earnings as well as a stricter version of net income that follow generally accepted accounting principles, or GAAP results. And even under those GAAP rules Tesla reported net income of $438 million, itself a record.

But the critics again say Tesla is losing money on actually selling cars and solar panels, its other primary business, and that it depends on selling $518 million in regulatory credits that other automakers need in order to comply with environmental rules, as well as the profit it reported on bitcoin trades.

The revenue and adjusted earnings both topped forecasts of Wall Street analysts surveyed by Refinitiv, although on a GAAP basis its net income fell a bit short of expectations.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
France Faces New Political Crisis, again, as Prime Minister Bayrou Pushed Out
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
France, at an Impasse, Heads Toward Another Government Collapse
The Country That Got Too Rich? Public Spending Dominates Norway Election
EU Proposes Phasing Out Russian Oil and Gas by End of 2027 to End Energy Dependence
More Than 150,000 Followers for a Fictional Character: The New Influencers Are AI Creations
EU Prepares for War
Trump Threatens Retaliatory Tariffs After EU Imposes €2.95 Billion Fine on Google
Tesla Board Proposes Unprecedented One-Trillion-Dollar Performance Package for Elon Musk
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Big Tech Executives Laud Trump at White House Dinner, Unveil Massive U.S. Investments
Tether Expands into Gold Sector with Profit-Driven Diversification
‘Looks Like a Wig’: Online Users Express Concern Over Kate Middleton
Florida’s Vaccine Revolution: DeSantis Declares War on Mandates
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
"The Situation Has Never Been This Bad": The Fall of PepsiCo
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
The Fashion Designer Who Became an Italian Symbol: Giorgio Armani Has Died at 91
Putin Celebrates ‘Unprecedentedly High’ Ties with China as Gazprom Seals Power of Siberia-2 Deal
China Unveils New Weapons in Grand Military Parade as Xi Hosts Putin and Kim
Rapper Cardi B Cleared of Liability in Los Angeles Civil Assault Trial
Google Avoids Break-Up in U.S. Antitrust Case as Stocks Rise
Couple celebrates 80th wedding anniversary at assisted living facility in Lancaster
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
The White House on LinkedIn Has Changed Their Profile Picture to Donald Trump
"Insulted the Prophet Muhammad": Woman Burned Alive by Angry Mob in Niger State, Nigeria
Trump Responds to Death Rumors – Announces 'Missile City'
Druzhba Pipeline Incident Sparks Geopolitical Tensions
Cost of Opposition Leader Péter Magyar's Economic Plan Revealed
Germany in Turmoil: Ukrainian Teenage Girl Pushed to Death by Illegal Iraqi Migrant
United Krack down on human rights: Graham Linehan Arrested at Heathrow Over Three X Posts, Hospitalised, Released on Bail with Posting Ban
Asian and Middle Eastern Investors Avoid US Markets
Ray Dalio Warns of US Shift to Autocracy
Eurozone Inflation Rises to 2.1% in August
Russia and China Sign New Gas Pipeline Deal
Von der Leyen's Plane Hit by Suspected Russian GPS Interference in an Incident Believed to Be Caused by Russia or by Pro-Peace or by Anti-Corruption European Activists
China's Robotics Industry Fuels Export Surge
Suntory Chairman Resigns After Police Probe
Gold Price Hits New All-Time Record
UK Fintechs Explore Buying US Banks
Greece Suspends 5% of Schools as Birth Rate Drops
Apollo to Launch $5 Billion Sports Investment Vehicle
Bolsonaro Trial Nears Close Amid US-Brazil Tension
European Banks Push for Lower Cross-Border Barriers
Poland's Offshore Wind Sector Attracts Investors
Budapest Central European Fashion Week Kicks Off
U.S. Celebrates Labor Day
Hungarian National Team Captain Scores Epic Goal
×