Tesla,Inc. is a company which engages in the design, development, manufacture, and sales of fully electric vehicles, as well as power storage and photovoltaic systems. It is ranked 7th most valuable company in the world by market cap at over $860B. The company is scheduled to release its Q2 2023 earnings result on 19th July (Wednesday), after market close.
Tesla Deliveries. Source: InsideEVs
In Q2 2023, Tesla reported total vehicle production at 479,700, up 86% compared to same period last year. Combined with Q1 data, total production hit 920,508 so far this year, up 63% from prior period.
On the other hand, total deliveries in Q2 2023 hit 466,140 (the highest quarterly number on record!), up 83% from the same period last year. Throughout H1 2023, Tesla has delivered 889,015 vehicles, 57% higher than H1 2022.
In Q2 alone, Model 3/Y deliveries up +87% to 446,915, whereas Model S/X deliveries up +19% to 19,225. Year-to-date deliveries for Model 3/Y has up 61% to 859,095, while Model S/X has down -3% to 29,920. In general, a price cut on its vehicles (especially in a competitive environment and when car loans becoming more costly in most countries due to higher interest rates) and incentives offered to buyers have spurred demand globally. Anyway, the price cut is short-lived as the company announced raising prices on its car models since May.
China dominated the electric car sales worldwide. According to China Passenger Car Association (CPCA), Tesla deliveries in June has jumped 19% (y/y) to 93680 vehicles, whereas its deliveries were up 120% (y/y) to 247,217 in the April to June months. In short, Tesla’s shipments from the Shanghai factory made up 53% of its total sales.
BEV Sales Share in Europe. Source: Counterpoint Research
EV sales in Europe have seen some improvement (+13% (y/y) in Q1 2023), albeit still below the level before Covid 19 pandemic. Pure EV (or Battery EV (BEV)) sales increased 32% from prior year period, with Tesla ranked 2nd on the BEV sales share (21.3%), just slightly behind Volkswagen (21.7%).
Prospects for electric car markets remain bright. In 2022, electric car makers have sold 10 million vehicles worldwide. Considering there are signs of emerging markets (for e.g. India, Thailand and Indonesia) slowly seeking to foster EV adoption, Iea.org predicted about 14 million in global sales by the end of this year.
Tesla’s Revenue by Segment. Source: Counterpoint
In Q1 2023, Tesla sales revenue was reported at $23.3B, with its automotive segment contributed the most at nearly $20.0B, up 18% from the same period last year. Other business operations (energy deployment and service) hit $3.3B, a huge leap of 78% from Q1 2022. Nevertheless, net profit of the company down -23% (y/y) to $2.5B, due to lowered vehicle selling prices, increased cost of logistics and raw material, Berlin factory utilization that was below expectation, etc.
Tesla Sales: Reported versus Analyst Forecast. Source: CNN Business
In the coming announcement, consensus estimates for Tesla sales stood at $24.3B, up 4.3% from the previous quarter, and up 43.8% from prior year period. Throughout this year, total sales revenue is projected at over $100B (plausible following the company’s solid fundamentals: Gigafactory (which could ramp up production – 1.8 million (or even 2 million) vehicles in 2023), Megafactory (large batteries for ample storage of electricity), growing number of automakers adopting Tesla’s supercharging network, etc). In the near future, the company will also release its Cybertruck by third quarter this year.
Tesla EPS: Reported versus Analyst Forecast. Source: CNN Business
EPS is estimated at $0.79, down 6 cents from previous quarter. It was $0.76 in Q2 2022. Last year, total EPS hit $4.07, up 80% from 2021.
Technical Analysis:
#Tesla (Tesla) ushered a good start since beginning this year. Upon gaining support at lows $101.77, the company’s share price has pared about 80% of the decline from Sept – Dec 2022. There is about $33 away from the peak seen last year (it is worth noting that the company’s share price once hit ATH at $1242). It is now trading above the median forecast of analyst ($250) and $268 (FR 78.6%). Recent price action also displays market indecisiveness, especially before the release of Tesla’s earnings. In short, if the said support remains intact, the bulls may continue to test key level $300, followed by the peak in September last year, at $313.63. On the other hand, a price close below $268 may indicate short-term correction, with $233 (FR 61.8%) in focus. MACD indicator in positive configuration.
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Larince Zhang
Market Analyst
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