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Tesla (TSLA) Q3 2023 earnings call
Oct
Tesla’s (NASDAQ:TSLA) Q3 2023 earnings name comes on the heels of the corporate’s Q3 2023 Replace Letter. Tesla remained worthwhile in Q3, regardless of a lower in supply and manufacturing, in addition to a discount within the firm’s common promoting worth. Nonetheless, Tesla posted revenues of $23.35 billion and a 7.6% working margin in Q3 2023.
Tesla did present some key data in its Q3 2023 Update Letter. For one, the Cybertruck’s first supply occasion has been introduced for November 30, 2023, and the cumulative miles of Tesla’s FSD Beta program additionally rose to 525 million. Tesla Power turned out to be the darkish horse for the quarter with its document vitality storage deployments of 4.0 GWh.
The next are dwell updates from Tesla’s Q3 2023 earnings call. I will probably be updating this text in actual time, so please hold refreshing the web page to view the most recent updates on this story. The primary entry begins on the backside of the web page.
17:30 CDT – And that wraps up Tesla’s Q3 2023 earnings name! This name is kind of heavy on data, and Elon Musk was surprisingly cautious. Contemplating the circumstances throughout the globe, nevertheless, that is comprehensible. Hopefully, Tesla does survive the storms which are coming.
Thanks a lot for staying with us for yet one more earnings name dwell weblog. We hope to see you once more within the subsequent one!
17:30 CDT – Wells Fargo asks for clarification about Elon Musk’s earlier remark about Tesla not going full tilt on Giga Mexico until the economic system is robust and if Tesla’s progress might be achieved with out the plant. Musk notes that Tesla will probably be making a manufacturing unit in Mexico. It’s simply going to be a matter of timing. Tesla continues to be engaged on Mexico, however the firm is paying shut consideration to rates of interest.
Plus, Giga Texas, regardless of its scope right this moment, continues to be only a tiny fraction of the land that Tesla owns. So technically, if push involves shove, Tesla can simply deal with Giga Texas and develop the complicated much more. “Tesla is a really succesful ship, however even an excellent ship in a storm has challenges,” Musk mentioned, including that if rates of interest come down, then Tesla ought to speed up.
“And I apologize if I’m maybe extra paranoid than I needs to be. As a result of which may even be the case as a result of I’m. I’ve PTSD from 2008 — 2017 by way of 2019 are usually not good both. That was very robust going. So you recognize, the auto business can also be form of cyclic. It’s as a result of individuals are inclined to hesitate to purchase a brand new automobile and if there’s uncertainty within the economic system,” Musk mentioned.
17:23 CDT – Cannacord asks a query about Tesla’s price per car coming down within the subsequent quarters. Is that this extra on scale, price reductions like giga casting, or different issues? The analyst additionally asks if radar was included in some Mannequin Y in China.
Elon Musk famous that Tesla has not included radar in Mannequin 3 and Mannequin Y vehicles from Giga Shanghai. Tesla is experimenting with this within the Mannequin S and Mannequin X, however there aren’t any plans to do that for the Mannequin 3 and Mannequin Y simply but.
Musk did be aware that Tesla is trying into the usability of radar by way of accident prevention. He acknowledged that vehicles that had radar earlier than had a radar unit that truly generated extra noise than sign. The CEO shared some feedback a few Tesla-designed radar.
“A Tesla-designed radar is a high-resolution radar that has some potential to be helpful,” Musk mentioned.
17:15 CDT – Elon Musk briefly mentioned the “Marie Antoinette vibes” in automobile pricing. To focus on this, Musk mentioned his disdain for a work-from-home system, which he famous was unfair to those that must be of their office for his or her jobs.
17:14 CDT – A follow-up query about worth elasticity was requested. Elon Musk highlighted that common shoppers are involved with funds. He additionally reiterated the significance of Tesla’s deal with decreasing month-to-month funds.
“I believe there’s very important worth elasticity. To be completely frank, if our automobile is similar price as a Toyota RAV4, no person would purchase a RAV4. Or at the least they’d be not possible to. Numerous these EV incentives are literally very troublesome for the common particular person to entry; They’ll’t entrance $7,500 for even 6 months,” Musk mentioned.
17:10 CDT – Wolfe Analysis asks if there’s a option to convey the pace of enchancment in Tesla’s enterprise. He additionally asks for any replace on the timing of Tesla’s next-generation car. The Tesla group famous that that is an evolving factor, and the corporate is constantly trying to enhance.
As for the timing of the next-generation product, Elon Musk famous that Tesla won’t be offering this data right now.
17:06 CDT – Pierre Farragu asks a query about FSD pricing and if Tesla might evolve the system’s pricing because it improves. Elon Musk famous that the economics of a completely autonomous car are fairly astounding. “The economics of the system are simply insanely constructive,” Musk mentioned. “We’re a {hardware} firm with software program margins.”
17:02 CDT – Analyst questions start! Truist begins with an inquiry concerning the Cybertruck and its ramp to important quantity. The analyst asks if an analogous ramp needs to be anticipated for the next-generation platform.
Elon Musk famous that Cybertruck’s manufacturing will ramp in 18 months. So, whereas the Cybertruck’s ramp will cowl three calendar years, it’s actually simply 1.5 years. The group additionally famous that the Cybertruck has distinctive complexities affecting the manufacturing ramp.
“We dug our personal grave with Cybertruck,” Musk joked, to some laughter from the group. “The Cybertruck has loads of bells and whistles.”
Musk famous that Tesla’s next-generation platform is kind of extra typical in that sense. There are merely not as many new issues with the next-gen car. Tesla is doing every thing attainable to simplify the next-generation car to realize ranges per minute by way of manufacturing. Musk additionally famous that the next-gen Tesla is “utilitarian however cool and exquisite.”
16:56 CDT – A query about Optimus was requested, and if a few of the robots might be deployed subsequent 12 months. Musk famous that at this level, Tesla will not be but prepared to debate updates with the Optimus program. However Optimus is bettering, and it’s bettering quick.
A closing investor query was requested about FSD’s worldwide rollout. Musk famous that rules in numerous nations dictate the supply of FSD outdoors the US. He additionally admits that he has been overly optimistic about Tesla’s FSD progress.
16:54 CDT – A query about FSD’s worth drop was requested. Musk notes that Tesla merely needs to make the system extra reasonably priced. The present worth is a brief low, Musk acknowledged. “Nicely, we simply wished to make it extra reasonably priced,” he famous.
A follow-up query was requested about when Tesla will settle for authorized legal responsibility for FSD. Musk joked that everybody already assumes Tesla has authorized liabilities. The group additionally highlighted that L3 programs just like the Mercedes-Benz Drive Pilot are very restricted, whereas Tesla’s FSD system is holistic. “It’s child AGI,” Musk mentioned.
16:52 CDT – A query about Tesla’s progress charge was requested. Elon Musk notes that Tesla is already one of many fastest-growing automakers right this moment. As for the Robotaxi, Musk famous that the car will certainly be non-driven. He highlighted that he’s certainly very enthusiastic about autonomy, which is fairly superb in its personal proper. That is particularly notable since Tesla’s work on autonomy will pave the best way for Optimus.
16:47 CDT – An inquiry about Giga Shanghai, Berlin, and Mexico was requested. Tesla notes that for Mexico, Tesla is working with manufacturing unit design. Tesla is engaged on new manufacturing line for next-generation car at Giga Mexico. Elon Musk states Tesla is laying the bottom work for development at Giga Mexico. “We simply need to get a way of the worldwide economic system” earlier than Tesla goes all-in.
Elon notes that Tesla is promoting. He acknowledges that promoting is beneficial, but when individuals can’t afford Tesla’s vehicles, promoting gained’t do a lot good. Musk emphasizes his considerations over rates of interest and the significance of Tesla’s deal with decreasing month-to-month funds.
16:44 CDT – A second investor query requested about an replace on the corporate’s 4680 cell initiative. Tesla notes that scrap is down 40%, and manufacturing is ramping. Giga Texas is now Tesla’s primary 4680 facility.
16:43 CDT – Investor questions start. First up is the corporate’s expectations for Cybertruck in 2024. Elon Musk notes that it’s troublesome to foretell this for the reason that Cybertruck is in order that completely different. It will be a distinct factor if the Cybertruck had been only a copy of one other pickup truck, after all. “The extra uncharted the territory, the extra unpredictable the end result,” Musk mentioned.
Musk did state that Tesla would ultimately hit about 250,000 Cybertrucks per 12 months. This can in all probability be achieved someday in 2025.
16:41 CDT – Tesla’s new CFO, Vaibhav Taneja, discusses the corporate’s funds. He mentions “regardless of some manufacturing unit shutdowns, our price per car decreased to roughly 37,500.” He additionally discusses that Tesla is concentrated on decreasing prices and investing sooner or later as the corporate navigates the years forward.
16:38 CDT – Musk additionally reaffirmed Tesla’s 2023 steering of 1.8 million automobiles.
16:37 CDT – Elon highlights that whereas the Cybertruck is being launched this quarter, expectations have to be set with regard to the car’s manufacturing ramp.
“There will probably be huge challenges in reaching volumes manufacturing and money circulate constructive. That is our greatest product ever, nevertheless it’d going to require immense work to get money circulate constructive at a worth that folks can afford.
“I simply need to mood expectations for the Cybertruck. It’s an excellent product, however financially, it’s going to take a 12 months to 18 months earlier than it’s a important money circulate contributor,” Musk mentioned.
16:36 CDT – Elon notes that Tesla Power and Service now contribute over half a billion {dollars} in quarter revenue. It’s changing into one of many firm’s most worthwhile companies, and it’s rising quick.
16:32 CDT – Oh boy, that was a technical concern. Elon Musk is already talking. He’s discussing Tesla’s progress with autonomy. He notes that he’s seeing important promise with FSD Beta V12, which is an end-to-end answer. “We are going to proceed to take a position closely in AI growth,” Musk mentioned.
16:30 CDT – It’s time! The Q3 2023 earnings name needs to be beginning any minute now. The music’s stopped, so we’re simply ready for the precise name to start.
16:29 CDT – And right here’s the music! I ponder if Tesla will begin on Elon time?
16:15 CDT – Hiya, everybody, and welcome to our dwell weblog of Tesla’s third-quarter earnings name! As anticipated, Tesla’s income and EPS took successful in Q3, thanks in no small half to the corporate’s lower in car deliveries. Tesla was nonetheless worthwhile, although, in order that just about proves that an EV enterprise might persistently earn a living.
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