Tesla Q3 results in 6 must-see metrics

Expectations were high at the start You’re here‘s (NASDAQ: TSLA) release of third quarter results – and the company did not disappoint. Both revenue and earnings per share exceeded analysts’ average forecasts, setting records for the company.

Here’s a closer look at Tesla’s top and bottom performance, the main drivers behind those metrics, and a few other important takeaways from the electric carmaker’s Q3 update on Wednesday afternoon.

Model Y. Image source: Tesla.

1. Income has jumped

Helped by a 73% increase in vehicle deliveries year-over-year, Tesla’s revenue grew 57% year-over-year. The company’s sales of its two lower-cost models – the Model 3 and the Model Y – accounted for most of this growth. Combined deliveries of the Model 3 and Model Y increased 87% year-over-year to approximately 232,000. Total deliveries for the period reached a record 241,391.

2. A robust gross profit margin

Seizing how economies of scale are playing out for Tesla, its automotive gross margin fell from 27.7% in the quarter of last year to 30.5%. This ultimately allowed gross margin to grow faster than revenue, growing 77%.

3. Adjusted earnings per share more than doubled

Tesla’s scalable business model was also evident in the company’s operating margin, which widened 534 basis points between Q3 2020 and Q3 2021, to 14.6%.

The improvement in operating profit was “due to growth in vehicle volume and lower costs,” Tesla said in its third quarter update.

Combining Tesla’s strong revenue growth with expanding its operating margin, the company’s non-GAAP (adjusted) earnings per share rose 145% year-on-year to $ 1.86. Unadjusted earnings per share rose 433% to $ 1.44.

4. Over $ 16 billion in cash

A combination of high free cash flow ($ 1.3 billion in the third quarter alone) and an already strong cash position enabled Tesla to repay net debt and repay finance leases of $ 1. $ 5 billion while ending the quarter with $ 16.1 billion in cash.

5. Rapid growth in energy storage deployments

Tesla’s energy storage deployments in the quarter increased 71% year-on-year to 1,295 megawatt hours (or about 1.3 gigawatt hours).

But Tesla noted in its Q3 update that this barely touches the surface of the fledgling energy company’s direction, as the new Megapack plant that Tesla recently opened on is expected to produce 40 gigawatt hours of storage capacity. of energy per year. This compares to Tesla’s total deployments over the past 12 months of around 3 gigawatts.

6. Guidance for a significant increase in deliveries

Finally, Tesla reiterated its forecast that shipments are expected to average a 50% compound annual growth rate over “a multi-year horizon”, despite the company’s warnings of “ongoing supply chain challenges. “,” Semiconductor shortages “and” congestion in ports. ” “

“We believe our supply chain, engineering and production teams have met these global challenges with ingenuity, agility and flexibility unparalleled in the automotive industry,” the company said.

For Tesla to meet its annual target of growing more than 50% of shipments this year, it will need to deliver more than 750,000 units by the end of the year. But with nearly 628,000 vehicles already delivered in 2021, that goal seems roughly in the bag.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.


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