Tesla Financials Deep Dive — Massive Growth
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Tesla (TSLA) CEO Elon Musk and the company’s top executives conducted the year 2023 and Q4 2023 earnings call last week (listen below).
The auto manufacturing and energy company also released its year 2023 and Q4 financial results on its investor relations website just before the earnings call commenced.
2023 was Tesla’s best year yet. In addition to delivering a record 1.8 million vehicles last year, Tesla’s energy storage and solar business grew more than double last year compared to 2022.
“I’ve said for many years that [energy] storage business would grow much faster than the car business,” Musk said during his Q4 2023 earnings call opening remarks.
Despite all the success Tesla achieved last year, Musk’s slower growth prediction for 2024 impacted the company’s stock price at market open the next day. Tesla’s (TSLA) share price dropped from a $207.83 close the day of the call to $182.63 (down by -$25.20 or 12.13%) at market close the next day.
TSLA Year 2023 Financial Update
Tesla reported the following figures in its 2023 shareholder report PDF:
Profitability
– $8.9B GAAP operating income in 2023; $2.1B in Q4
– $15.0B GAAP net income in 2023; $7.9B in Q4
– $10.9B non-GAAP net income1 in 2023; $2.5B in Q4
– One-time non-cash tax benefit of $5.9B recorded in Q4 for the
release of valuation allowance on certain deferred tax assetsCash
Operating cash flow of $13.3B; free cash flow of $4.4B in 2023
Operating cash flow of $4.4B; free cash flow of $2.1B in Q4
$3.0B increase in our cash and investments3 in Q4 to $29.1BOperations
Model Y became the best-selling vehicle in the world
Energy storage deployment of 14.7 GWh in 2023, 125% growth.
Q4 2023 vs. Q4 2022
Compared to the same quarter last year, Tesla did not make a giant leap in revenues in Q4 2023. In fact, Tesla only grew 1% in automotive revenues in Q4 2023 vs. Q4 2022 ($21.3B vs. $21.65B).
As Musk explained in the earnings call, the energy storage side of the company made good progress. Energy generation and storage revenue grew by 10% in Q4 compared to the last year ($1.31B in Q4 2022 vs. $1.44B in Q4 2023).
Tesla’s revenue generation from services and other venues grew by a staggering 27% in Q4 2022 vs. Q4 2023.
However, Tesla’s Operating Margin dropped massively in Q4 2023 compared to the same quarter last year. It went downhill from 16.0% to 8.2% — a massive drop of -784 bp.
Tesla produced 13% more vehicles in Q4 2023 compared to Q4 2022. Similarly, the company’s vehicle deliveries grew by 20% in Q4 YoY as well.
Interestingly, while Tesla’s Solar Panel/Solar Roof deployment declined by -59%, its battery energy storage system (BESS) saw a growth of 30% comparing Q4 2023 and Q4 2022. Tesla deployed a total of 3,202 MWh (3.2 GWh) of energy storage in Q4 2023 alone.
Tesla’s Growth in the Last 5 Years
Tesla (TSLA) shared an interesting data table in its 2023 shareholder deck. This table shows Tesla’s exponential growth in terms of revenue, operating margin, and profit from 2019 to 2023.
Even though Tesla launched its Tesla Model Y crossover SUV in 2019, the automaker generated a total of only $20.821 billion in automotive revenues. In 2023, Tesla’s total automotive revenue was $82.419 billion. This is a massive growth of around 400% over the last 5 years.
Tesla’s operating margin also increased from -0.3% (negative 0.3%) in 2019 to 9.2% in 2023. The year 2022 was the best for Tesla, as the company generated around 17% operating margin.
Tesla achieved phenomenal operational growth in the last 5 years. The automaker made 3 gigafactories operational since 2019 — Giga Shanghai, Giga Berlin, and Giga Texas.
Tesla’s production and deliveries grew by more than 500% over the last 5 years. The automaker produced only 365,232 cars in 2019 vs. 1,845,985 in 2023. Tesla (TSLA) delivered 367,656 vehicles in the entire year 2019 compared to 1,808,581 in 2023.
The number of vehicles Tesla used to produce in an entire year 5 years ago is even less than a quarter’s production now. Tesla has mastered the art of scaling vehicle production in as little time as possible.
Tesla achieved around 900% growth in the energy storage deployment business during the last 5 years. Tesla delivered 1.65 GWh of battery storage in 2019, which is dwarfed by the 14.7 GWh of BESS deployment in 2023.
Energy storage deployments reached 14.7 GWh in 2023, more than double compared to the previous year, while Energy Generation and Storage business profits nearly quadrupled in 2023. Gross profit of our Services & Other business increased from a ~$500M loss in 2019 to a ~$500M profit in 2023.
Tesla 2023 Update
According to Tesla CEO Elon Musk, the automaker already achieved a 2 million vehicle production rate at the end of 2023 (listen to earnings call below). He also announced that the automaker’s Fremont car factory in California alone produced 560,000 cars last year. The Fremont factory is now North America’s largest auto manufacturing facility.
Tesla Delivered 1.2 Million Model Ys in 2023
Tesla usually does not report separate production and delivery numbers of the Model 3 sedan and Model Y SUV. It is the first time in the last 5 years that Tesla launched the Model Y that the automaker has published separate 2023 delivery figures for the Tesla Model Y.
Tesla Model Y sales in 2023 were almost equal to the entire year’s Tesla sales of Model S, X, 3, and Y in 2022. This tells us how much Tesla has learned to exponentially scale vehicle production.
Reportedly, Tesla is working on a Model Y design refresh model. This project is codenamed Juniper. Like the Model 3 Highland, Tesla is keeping this a secret till the automaker is ready to start production.
Before the Model Y’s launch in 2019, Elon Musk used to say that this vehicle would be the best-selling Tesla ever made, and time has proven his prediction to be correct.
In 2023, we delivered over 1.2 million Model Ys, making it the best-selling vehicle, of any kind, globally. For a long time, many doubted the viability of EVs. Today, the best-selling vehicle on the planet is an EV.
Tesla 2023 Update
Let’s listen to what Elon Musk said during the Tesla (TSLA) Q4 2023 earnings call.
Originally published on Tesla Oracle.
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