REUTERS: Tesla Inc reported record vehicle deliveries for the second quarter on Friday, meeting Wall Street expectations as the electric carmaker dealt with a semiconductor shortfall and relied on sales of its less expensive models. Tesla fared better than traditional automakers during the global supply crisis, but CEO Elon Musk has warned of difficulties obtaining chips and other materials.
Due to Tesla’s exposure to the cryptocurrency’s volatility, all eyes are now on its second-quarter earnings to see if recent reductions in bitcoin prices would have a negative impact on the company’s bottom line.
During the second quarter, Tesla delivered a total of 201,250 automobiles. According to Refinitiv statistics, analysts anticipated Tesla to deliver 200,258 units. Garrett Nelson, a stock analyst at CFRA Research, said, “It was a solid quarter to volume wise, but I view it as a modest disappointment.” The company’s stock gained 0.3 percent after surging as high as 3.3 percent in early Friday trading.
“With these delivery numbers, the bulls are breathing a sigh of relief,” said Dan Ives, an analyst at Wedbush Securities.
Model 3 sedans and Model Y crossovers, the company’s two lower-priced variations, accounting for 99 percent of deliveries, offsetting a decline in higher-end Model S and X vehicle deliveries.
Tesla stated, “Our employees have done a great job navigating through global supply chain and logistics hurdles.”
Tesla has been hiking its vehicle costs in recent months, which its billionaire CEO, Elon Musk, blamed on “significant supply chain price pressure,” particularly in raw materials, in May.
In early June, he also stated that “The supply chain, particularly microcontroller chips, is our largest concern. It’s unlike anything I’ve ever seen.” The worst may be gone for Tesla in terms of chip shortages, according to RBC, but the potential margin hit from broad supply chain tightness might last the rest of the year. MODEL S PLAIDI, CHINA Tesla is facing large-scale recalls, more attention from regulators and the public, as well as intensifying competition from local EV businesses in China, a crucial growth region for the company. “The demand difficulties around China existed in April, but obviously rebounded in May and June,” Ives added. In May, Tesla sold 21,936 Model 3 and Model Y cars in China, rebounding from a sales drop in April but still falling short of March’s totals. In the following days, it will reveal its June sales in China. During the April to June period, Tesla’s Model S and X vehicle deliveries fell to 1,890, as a new version of the Model S was delayed before its June launch. Just three days after being delivered, a Tesla Model S Plaid electric vehicle with a price tag of US$129,990 erupted into flames as the owner was driving. The model was ordered to be grounded by the owner’s lawyer. When contacted by Reuters, Tesla did not respond immediately. BITCOINSharp decreases in bitcoin prices might also hurt Tesla’s second-quarter earnings, according to analysts. Tesla announced its $1.5 billion bitcoin investment on February 8. Through the selling of 10% of its bitcoin assets, it was able to create profits in the first quarter. However, the transaction exposes Tesla equities to the unpredictable cryptocurrency market, which has seen recent drops. Despite bitcoin representing for a minor fraction of Tesla’s overall cash, “Tesla stock price has been quite closely linked with the price of bitcoin,” Nelson said, adding that this damages investor sentiment. (Editing by Sriraj Kalluvila, Saumyadeb Chakrabarty, Aurora Ellis, and Philippa Fletcher; reporting by Hyunjoo Jin in Berkeley, Calif., and Akanksha Rana and Subrat Patnaik in Bengaluru)/n
