Tesla Earnings Results
Metric Beat/Miss/Match Reported Value Analysts' Prediction
Adjusted EPS Beat $0.93 $0.86
Revenue Match $10.4B $10.4B
Vehicle Deliveries Beat 184,800 184,700

Source: Predictions based on analysts' consensus from Visible Alpha

Key Takeaways

  • Vehicle deliveries, reported earlier this month, came in slightly above analyst estimates.
  • Higher vehicle deliveries indicate increasing demand for Tesla's main source of revenue as well as the company's ability to scale production.
  • Tesla expects to begin production and deliveries at its Gigafactories in Berlin and Texas sometime this year.

Tesla (TSLA) Financial Results: Analysis

Tesla, Inc. (TSLA) reported Q1 FY 2021 earnings that beat analyst expectations. Adjusted earnings per share (EPS) came in $0.07 higher than expected. Revenue matched analyst forecasts. Tesla's vehicle deliveries for the quarter, which it reported earlier this month, came in at 184,800, slightly above estimates. The company's shares were down more than 1% in after-hours trading. Over the past year, Tesla's shares have provided a total return of 361.9%, well above the S&P 500's total return of 45.5%.

TSLA Vehicle Deliveries

Tesla's primary business is making electric vehicles, and it needs to continue expanding production in order to grow revenue and profits. The company has made a number of key acquisitions in recent years – including Germany-based Grohmann Engineering GmbH and Perbix Machine Co. Inc. – to increase its manufacturing efficiency and capacity. Tesla said that it was currently building capacity for its Model Y at a Gigafactory in Berlin and one in Texas. It expects to begin production and deliveries from each location in 2021. Increasing productive efficiency and capacity is important to justify Tesla's high valuation. The company is facing increasing competition from rivals like Volkswagen AG (VOW3) and Ford Motor Company (F).

Tesla achieved its highest ever vehicle deliveries in Q1 despite facing a number of challenges, such as seasonality and instability in its supply chain. A global semiconductor shortage has led to the idling of production by a number of global automakers. Tesla said that it dealt with the chip shortage by "pivoting extremely quickly to new microcontrollers, while simultaneously developing firmware for new chips made by new suppliers." It also noted that its Model 3 was the best-selling premium sedan in the world, outselling even its gas-powered counterparts. Tesla said that its vehicle deliveries were the primary driver of its substantial revenue growth.

Looking ahead, Tesla said that it believes vehicle deliveries will grow at an annual pace of 50% over a multi-year horizon, although deliveries will likely exhibit faster growth some years. The automaker expects to exceed 50% growth in vehicle deliveries in FY 2021.

TSLA Profitability

Tesla's non-GAAP net income surpassed $1 billion for the first time ever. Overall profitability was boosted by volume growth, regulatory credit revenue growth, cost reductions, and the sale of bitcoin. These positive impacts were offset by lower average selling prices, increased stock-based compensation expenses, additional supply chain costs, research and development (R&D) investments, and other items.

Tesla's next earnings report (for Q2 FY 2021) is estimated to be released on July 20, 2021.