Tesla grows revenue 42%, but automotive margins decline

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Tesla Inc. signage outside a dealership at the Easton Town Center shopping mall in Columbus, Ohio, U.S., on Friday, Dec. 10, 2021.
Luke Sharrett | Bloomberg | Getty Images

Tesla is set to report second-quarter earnings after the bell on Wednesday.

Here’s what investors are expecting, according to a consensus of analysts’ estimates compiled by Refinitiv:

Earnings per share: $1.81 expectedRevenue: $17.1 billion expected

Early this month, Tesla reported vehicle deliveries of 254,695 electric cars for the period ending June 30, 2022, showing 27% growth from the year-ago quarter, but an 18% decrease sequentially. Deliveries are the closest approximation of sales Tesla discloses. Its Model 3 and Model Y vehicles comprised 93% of those deliveries.

Last year during the second quarter, Tesla said deliveries amounted to 201,250 vehicles, its first time topping 200,000 in a three-month period. In the first quarter of this year, Tesla reported deliveries of 310,048 vehicles.

Russia’s brutal invasion of Ukraine and Covid outbreaks in China exacerbated ongoing semiconductor and parts shortages, along with other supply chain snags. Covid restrictions in Shanghai forced Tesla to temporarily suspend or limit production at its factory there during the second quarter of 2022.

CEO Elon Musk also lamented the high costs of starting up production at new factories in Austin, Texas and Gr?nheide in Brandenburg, Germany. During an interview with Tesla Owners Silicon Valley, a company-recognized fan club, Musk said the two new factories “are gigantic money furnaces.”

The CEO announced steep headcount cuts in June.

Tesla’s cryptocurrency holdings also likely declined in value substantially, depending on how the company traded them. Barclay’s analyst Brian Johnson said on Monday that he expects Tesla to record an impairment of up to roughly $460 million due to bitcoin declines.

On the brighter side, Tesla recently marked a milestone with an employee posting on LinkedIn this week that the company surpassed production of 2 million vehicles at its Fremont, California factory.

According to a White House memo from June 28, Tesla also plans to “begin production of new Supercharger equipment that will enable non-Tesla EV drivers in North America to use Tesla Superchargers.”

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