Tesla on the cusp of the storm, the financial report is eye-catching but intriguing

In the early morning of April 27th, Beijing time, after the US stock market closed, Tesla announced its first quarter financial report for the 2021 fiscal year.

Tesla said that in the first quarter, despite the seasonal effects, supply chain instability, and the challenges of transitioning to new models and Model X, Tesla still achieved the highest ever production and delivery volume.

The total revenue for the quarter was US$10.389 billion, a 74% increase from US$5.985 billion in the same period last year. GAAP net profit reached US$438 million, which was 26 times that of the same period last year. Non-GAAP net profit also exceeded 1 billion for the first time. The dollar mark reached 1.1 billion.

This financial report is not unglamorous, with substantial growth in production, sales, and profits. The outstanding performance of the first fiscal quarter also reached the target set by the board of directors, enabling Elon Musk to receive two option awards with a total value of approximately US$11 billion.

There are also several points worth paying attention to in the financial report. Tesla’s revenue from the sale of carbon credits reached 520 million U.S. dollars. In addition, the profit from the reduction of Bitcoin holdings was 100 million U.S. dollars. Excluding these two parts of income, Tesla’s profit for the fiscal quarter was negative.

Domestic sales have risen sharply, accounting for 40% of global sales

Tesla delivered 69,000 vehicles in the domestic market in the first quarter, three times that of the same period last year and already accounted for 40% of global sales in the current quarter. In March alone, Tesla sold more than 35,000 vehicles in the domestic market, including more than 25,000 Model 3 models and more than 10,000 Model Y models. This contribution to Tesla’s global sales is unquestionable, and China may become Tesla’s largest market in the future.

In the first quarter, the global production of Tesla Model 3 and Model Y reached 180,338, an increase of 107% compared to the same period last year. However, in the first quarter, Tesla Model 3 and Model Y delivered 182,847 vehicles, an increase of 140 compared to the same period last year. %, the delivery volume is much larger than the output, indicating that Tesla is still in short supply. The sharp increase in output can also show that Tesla's previous supply chain impact has also been eased. The global chip shortage is also a big challenge for Tesla's continuous increase in output. The Model S and Model X that were not produced in the first quarter also achieved 2030 deliveries, and the total delivery reached 184,877 vehicles, an increase of 109% year-on-year.

Tesla is also launching plans to increase production capacity in the Berlin and Texas factories, and the Shanghai factory will continue to increase production capacity. For the problem of chip shortages, Tesla seems to have found a new supplier to solve its urgent needs.

Model 3 has become the world's best-selling premium sedan, which is also the main driving force for Tesla's substantial revenue growth.

Compared to traditional car companies, the most surprising possibility is that the inventory cycle in the first quarter is only 8 days, setting a new historical record, indicating that every car produced by Tesla is almost directly delivered to consumption within a few days. On the hand.

Net profit has doubled by 26 times, but it does not lose money by relying on carbon credits and Bitcoin

Tesla's net profit attributable to common shareholders in this quarter was $438 million, which was 26 times that of the same period last year, but it is strange that Tesla's selling price has been decreasing.

In 2020, the average selling price of all Tesla models dropped by 11% compared to 2019. In the first quarter of this year, it also dropped by 6% compared to the fourth quarter of last year. However, the gross profit margin of each car increased instead of decreasing: The first quarter was 26.5%, a 2.4% increase from the previous quarter and 1% higher than the same period last year.

The reason for this "abnormal" phenomenon is that compared with the price of automobiles, production costs have fallen faster, and price cuts have also brought about a substantial increase in sales, and both gross profit margin and sales have risen at the same time.

But things don’t seem to be that simple. The gross profit of Tesla’s financial report for the first quarter was US$2.385 billion, a record high, an increase of 85% compared to the same period last year, but US$518 million of this was due to the sale of carbon credits. Income. If this part is removed, the gross profit of Tesla's automotive business will drop to 1.867 billion U.S. dollars, the gross profit margin has also dropped to 22%, and the net profit may be negative.

In addition, the reduction of Bitcoin holdings also brought more than $100 million in revenue to the company, which also constitutes an important source of Tesla's net profit.

So for Tesla, relying on carbon credits and Bitcoin to earn "extra" seems to bring a "windfall" to the company.

However, Musk will invest in Bitcoin as a way to store the company's cash, which can not only maintain a certain degree of liquidity, but also bring a certain amount of income, which indeed seems to be a good choice for Tesla.

What else did Musk say at the earnings conference?

In the conference call after the announcement of the first quarter earnings report, Tesla management also talked about the future development.

Talk about Dojo

Dojo is a neural network supercomputer project of Tesla, which aims to realize fully intelligent autonomous driving. At present, people generally regard Tesla as an electric car or energy company, but in the long run, Tesla is actually an "artificial intelligence robot" company. Tesla is forming the world's most powerful software and hardware team to achieve the development of the world's most advanced artificial intelligence system.

Talking about solar energy

Although the price of solar roofs has increased, they are still in short supply, and market demand is far greater than Tesla's installation speed. However, the diversity and complexity of the roof may exceed Tesla's expectations, and it is difficult to have a solution suitable for all roofs, so the installation rate will not be particularly fast.

And each set of solar roofs will be equipped with Powerwall, so that even if the entire block is out of power, households using solar roofs will not be affected by the power outage. After cooperation with the power grid, the excess power generation of each household can be supplied to the power grid, making the power grid a huge power distribution device.

Finally, electricity facilities need to strengthen power storage capacity to store renewable energy such as solar and wind energy.

Talk about Bitcoin

Tesla invested $1.5 billion in the Bitcoin market in the first quarter, and then reduced its holdings by 10%. Tesla also supports Bitcoin as a payment method. Bitcoin can be used as a good way to store cash flow. It can also obtain some considerable benefits while maintaining a certain amount of cash liquidity. Compared with traditional low-yield or low-liquidity methods, investing in digital currency may be a good way to store cash flow. A very good solution. Musk is also willing to hold Bitcoin for a long time and believe in its value.

Talk about battery energy storage

The self-discharge of lithium batteries is not that large, and the self-discharge of high-quality lithium-ion batteries only accounts for 0.001% of the daily power. Seasonal technology still has a long way to go, and solar and wind energy may be able to solve this problem. Ten thousand square miles of solar panels can supply the electricity needed by the entire United States. It is entirely possible to install solar panels in a small area to power the world, and the ultra-high voltage long-distance transmission of electric energy can greatly reduce heat loss, and solve the new energy problem without waiting for the realization of room temperature superconducting technology.

Talking about automobile production capacity

Mass production of automobiles is actually very difficult. As long as one of the thousands of parts is in short supply, all of them have to be stopped. Musk is very confident about the future production target of 4680 batteries. Tesla will also work with suppliers to speed up supply, hoping to double sales. Musk also hopes that the energy storage business can give a gross profit level equal to that of the vehicle business, but the vehicle business does need to be more mature.

Talk about autonomous driving

Tesla is committed to launching a new version of Fully Autonomous Driving (FSD), and FSD purchases may also shift from cash payments to periodic subscription services, which may affect short-term cash flow, but in the long-term this is a very potential Income.

However, Tesla used to mention the sales performance of the Chinese market in the previous financial report meetings, but this time it did not mention a word, and the recent rights protection incident on the cusp has not subsided. This is a bit intriguing, and we have to wait for Tesla. Follow-up further processing.

Tesla has high expectations for future sales. In order to achieve this goal, the growth of the domestic market may become the biggest driving force, and the ultimate trend of the rights protection incident will definitely become an important factor in Tesla's domestic sales.

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