Tesla’s Q3 sales missed projections, although the energy unit increased

• ByStartupStory     |    October 20, 2022

Tesla posted third-quarter revenue of $21.45 billion on Wednesday, another record-breaking quarter that fell short of analysts’ projections. After-hours trading saw a 3.5% decline in shares as a result of the results report.

Tesla’s net income for the third quarter was $3.3 billion, almost twice as much as it was during the same period last year ($1.62 billion). The company said that the production of 4680 battery cells as well as problems scaling up production at its German and Texas operations reduced profitability. In its third-quarter results, Tesla also highlighted the stronger currency as a contributing factor.

In its letter to shareholders for the third quarter, the company reaffirmed much of its forecast, including its goal of delivering 50% more vehicles per year and its December Semi truck production objective. Only stating that it has made headway with its “industrialization” and that manufacturing would start at its Texas factory after the Model Y ramp, Tesla offered few information on its launch plans for Cybertruck.

Tesla reported earnings of $1.05 per share, excluding certain factors, compared to 62 cents per share during the same time last year. With third-quarter revenue from the automotive division coming in at $18.69 billion, up 55% from the same quarter last year, it remained the company’s largest segment. The business’s automotive gross margins were 27.9%, unchanged from the previous quarter but still below the high of 32% set at the beginning of the year.

In the third quarter, Tesla delivered 343,830 automobiles, setting a new record. Earlier this year, a closure at its China facility and difficulties with the construction of factories in Berlin and Austin had a negative impact on the number of vehicles the company was able to sell to consumers. Despite the uptick and record number, the third-quarter delivery result still fell short of Wall Street expectations, which, depending on the surveyed group, varied between 358,000 and 371,000 automobiles. The difference between production and delivery numbers was considerably greater than typical. In the third quarter, the firm manufactured 365,923 automobiles.

The energy division of Tesla, which had struggled in prior quarters, had a noticeable uptick in business.According to the business, energy storage deployments—which include both Megapack utility-scale energy storage systems and Powerwall household batteries—have increased 62% year over year, from about 1.29 GWh in Q3 2021 to 2.1 GWh in the same quarter this year.

This was “by far the biggest level [of growth] we have ever attained,” according to the company.The information comes in response to a September story that claimed Tesla has started mandating customers who purchase solar roofs to also purchase a Powerwall for energy storage. When a Megapack caught fire at a California power storage plant, the company’s large-scale batteries also recently garnered news. A section of Highway 1 was closed due to the incident, and a shelter-in-place warning was issued for the area in Moss Landing.

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