Tesla Inc (NASDAQ: TSLA)’s stock price was riding a roller coaster over recent years, from around $20 per share at the end of 2018, the boom to over $400 in 2021 and the crash to $110 in the beginning of 2023. TSLA’s latest price is likely to be volatile yet again, after it fell by over 4% during last night’s (18 Oct) session before closing at $242.68 a share. Then TSLA continued to fall by another 4% again to $232.4 during the after hours, due to the pessimistic earnings call by Elon Musk himself.
The CEO Elon Musk said his own design and the questionable spec “Cybertruck,” risked not delivering a cash flow for the next 12 to 18 months before the beginning of production in the Giga factory in Texas. The CEO also emphasized that TSLA needed to focus on more work to increase the quantity amid the world conflict and interest rate hiking cycle that is not yet to end, while the new factory in Mexico is still under construction.
TSLA reported its revenue at $23.35 billion which is below the $24 billion expectation. The reason for missing expectations could be due to the number of deliveries in the third quarter at 435,059, which was a decrease by 7% from the previous quarter, though an increase of 27% from last year. Meanwhile, the company also suffered from high operating costs as Musk himself targeted a higher number of production of 1.8 million vehicles this year, rather than a profit margin.
The adjusted earnings reported at 66 cent per share compared to the expected 73 cent. The total operating margin also significantly decreased to 7.6% compared to the 17.2% in last year, while the total gross profit also declined by 22% YoY.
As for the cost items, TSLA’s cost of goods sold per vehicle decreased to $37,500, while the R&D expenses increased to $1.16 billion from $733 million in last year due to the AI training hardware upgrades.
