Tesla Earnings Crush Expectations: 5 Must-See Points



[ad_1]

After Monday’s bell, electric car maker You’re here (NASDAQ: TSLA) reported dramatic results. Revenue nearly doubled year over year as net profit skyrocketed. Investors appeared content as stocks rose several percentage points during after-hours trading. Although this gain came back to closer to 1% later in the evening.

“In the second quarter of 2021, we broke some notable new records,” Tesla said in the company’s second quarter update. “We have produced and delivered over 200,000 vehicles, achieved an operating margin of 11% and exceeded [$1 billion] of GAAP net income for the first time in our history. “

Here’s a look at the quarter, captured by five must-see points from the report.

Interior of the Tesla Model Y

Tesla Model Y. Image source: Tesla.

1. Turnover reaches 12 billion dollars

Helped by a 121% year-over-year increase in vehicle deliveries, Tesla’s revenue jumped 98% year-over-year to about $ 12 billion. This crushed analysts’ average forecast for revenue of $ 11.3 billion.

2. Profits have skyrocketed

Of course, with income like this, it was no surprise to see profits skyrocket. Net income fell from $ 104 million a year ago to $ 1.14 billion. Non-GAAP (adjusted) net income increased 258% year-over-year to $ 1.6 billion. That translated into non-GAAP earnings per share of $ 1.45, well above analysts’ consensus estimate of $ 0.98.

Tesla’s disproportionate profit growth demonstrates the scalability of the company’s business model.

3. Free cash flow remains healthy

Tesla again generated positive free cash flow, that is, operating cash flow less capital expenses. Free cash flow for the period increased from $ 418 million in the prior year period to $ 619 million.

Total cash flow increased from $ 17.1 billion in the first quarter of 2021 to $ 16.2 billion, but this is mainly due to $ 1.6 billion in net debt and finance lease payments.

4. Demand for vehicles is robust

Tesla has again said demand for its vehicles has reached record levels. Indeed, demand is so robust that the business is limited by supply. “Global demand continues to be robust and we are producing at the limits of the available parts supply,” Tesla explained.

5. There is stronger growth to come

Above all, Tesla remains optimistic about its growth trajectory. The company says it continues to expect growth in total shipments of more than 50% year-over-year this year. This implies total deliveries of over 750,000 in 2021. So far, Tesla has delivered over 386,000 vehicles this year.

“The rate of growth will depend on the capacity of our equipment, operational efficiency and the capacity and stability of the supply chain,” Tesla noted.

With strong demand, a healthy balance sheet, and management optimism about the future, Tesla’s growth story is alive and well.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.



[ad_2]

Source link