Budapest Post

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

Tesla profits jump and Elon Musk is confident amid global economy woes

Tesla profits jump and Elon Musk is confident amid global economy woes

Musk dismissed the idea that global economic problems were hurting interest in Tesla, despite vehicle prices' rising to what he called "embarrassing levels".

Tesla reported a smaller-than-expected drop in quarterly profit as a string of price increases on its electric vehicles (EVs) helped offset production challenges caused by supply chain issues, 1COVID1-19 lockdowns in China.

Chief Financial Officer Zachary Kirkhorn said on Wednesday Tesla was still pushing to reach 50 per cent growth in deliveries this year, adding that while the target had become more difficult, "it remains possible with strong execution".

Tesla's second-quarter profit fell 32 per cent from record levels in the first quarter.

But the Austin, Texas, company still surprised analysts Wednesday with a better-than-expected $2.26 billion (€2.23 billion) net profit for the quarter. Tesla stuck with a prediction of 50 per cent annual vehicle sales growth over the next few years, but said that depends on the supply chain, equipment capacity and other issues.

The company made a record $3.32 billion (€3.25 billion) in this year's first quarter.

Tesla's sales from April through June fell to 254,000 vehicles, their lowest quarterly level since last fall. But the company predicted record-breaking production in the second half and said that in June it had the highest production month in its history.

Industry analysts had been expecting lower earnings after the lower sales figures and tweets by CEO Elon Musk about laying off 10 per cent of the company's work force due to fears of a recession.


What has Elon Musk said?


In an interview, Musk described new factories in Austin and Berlin as “money furnaces” that were losing billions of dollars because supply chain breakdowns were limiting the number of cars they can produce.

Musk said he expects inflation to start easing by end-2022 and most commodity prices to stabilise.

Tesla does not have a demand problem, but a production problem, Musk told a conference call. He dismissed the idea that global economic problems were hurting interest in Tesla, despite vehicle prices' rising to what he called "embarrassing levels".

But Tesla exceeded Wall Street expectations from April through June with adjusted earnings of $2.27 (€2.22) per share. Analysts polled by FactSet expected $1.81. Revenue was $16.93 billion, beating estimates of $16.54 billion.

Edward Jones analyst Jeff Windau said the earnings were better than expected. He noted that the decrease in automobile revenues from the first quarter was offset by stronger energy storage, solar and services performance.

Musk reiterated the 50 per cent annual vehicle sales growth forecast but said it depends a lot on circumstances that the company might not be able to control.

Windau said the forecast “shows the confidence they have in their ability to grow the electric vehicle market.”

Tesla shares rose 1.5 per cent to $753.40 (€737) in extended trading Wednesday.


Converting Bitcoin


The company said it converted 75 per cent of its Bitcoin investment to government currency during the quarter, adding $936 million (€916 million) in cash to its balance sheet. It spent $1.5 billion (€1.47 billion) on the investment last year. Overall, it booked a $106 million (€103 milion) cost for Bitcoin, plus added costs for employee reductions.

CEO Elon Musk said the bitcoin holdings were sold to raise cash because of uncertainty over how long pandemic lockdowns would last in China. He said Tesla is open to increasing bitcoin holdings in the future.

The price of Bitcoin has fallen about 50 per cent so far this year.

Musk also said Tesla is seeing indications that inflation may decline as prices for most commodities drop. He cautioned against making economic predictions but said commodity prices, such as steel and aluminium, are trending down.


Plans for 'Full Self-Driving' car


Musk said Tesla’s “Full Self-Driving” beta test software is on track to be released before the end of this year to all North American customers who want to buy it. And with regulatory approval, it will be released in Europe and other parts of the world, he said. Despite its name, “Full Self-Driving” cannot drive itself, and Tesla warns that drivers have to pay attention all the time.

Chief Financial Officer Zachary Kirkhorn said the company is seeing “maybe a little” impact on demand due to macroeconomic issues.

Musk reiterated that Tesla has a vehicle supply problem, not a demand problem, and said it now takes six months to a year to get a new vehicle. He said the company has increased prices to “embarrassing levels” due to inflation, but he hopes to reduce prices a bit.

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
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
U.S. and China Agree on Framework to Shift TikTok to American Ownership
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
The New Life of Novak Djokovic
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
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
×