Shulou(Shulou.com)11/24 Report--

On January 26, Tesla, a US electric car manufacturer, released its results for the fourth quarter and the whole year of 2022 after local trading on Wednesday. Tesla's fourth-quarter revenue was $24.3 billion (currently about 164.754 billion yuan), up 37% from a year earlier, while net profit was $3.7 billion (currently about 25.086 billion yuan), up 59% from a year earlier, according to the financial report.

Tesla achieved the highest quarterly income, operating income and net profit in history. After the announcement, Tesla chief executive Elon Musk (Elon Musk), chief financial officer (Zach Kirkhorn) and investor relations director Martin Martin Viecha and other executives attended the earnings conference call to introduce the company's fourth-quarter results and answer questions from investors and analysts.

Musk first reviewed the financial data for 2022. "it was a wonderful year for Tesla," he said. "on every level, this is the best year we've ever had." Musk said that the market demand for Tesla electric vehicles is very strong, especially after the price reduction. The company's orders peaked in January 2023, almost twice the factory's output. "although the entire auto industry is likely to shrink, we think demand will be good," he said. "

Musk highlighted some key upgrades to Tesla's beta FSD system. The beta version of FSD has reached 400000 users and 100 million miles off the highway, he said. Musk also specifically emphasized the security of the beta FSD system. "if these statistics are not accurate, we will not release a beta version of FSD," he said.

Speaking of Tesla's energy storage products, Musk said, "I want to make it clear that there is a path to a sustainable energy future." Tesla is increasing the output of Tesla's energy storage product Megapack at a faster rate than producing electric cars, he added. "Manufacturing technology will be our most important long-term advantage."

Then Kirkhorn spoke, thanking team Tesla for their achievements last year. He said the company's revenue grew by 50% last year and its operating profit doubled. "We believe we are on a good track," Kirkhorn also stressed that the market demand for the company's products is very strong.

Kirkhorn revealed that Tesla is giving priority to providing funds for the company's future plans. He explained that Tesla is trying to solve some production inefficiency problems, such as ramp-up mass production in factories in Berlin and Texas and problems in internal battery production.

Then Tesla executives began to answer questions from investors and analysts.

The first question raised by investors is about the market demand for Tesla's products. Both Musk and Kirkhorn have stressed that this is not a problem.

Then an investor asked Tesla about his carbon credits. Mr Musk says Tesla will be able to gain great value from carbon credits in the long run. And the acquisition of this kind of points mainly depends on Tesla's local production. "in the long run, Tesla expects the value of these points to be considerable," Musk said. " The value of carbon credits in 2023 will not be great, but it is likely to be great in the future, he added.

Tesla will receive a varying number of points, and the company hopes to use such incentives to improve affordability, Kirkhorn said. "We hope to use this to accelerate the development of sustainable energy, which is our mission and the reason for this bill," he said. "

The next question for investors is about the gross profit margin of Tesla's electric vehicles, especially after the company slashed the price of its car products around the world. Analysts estimate that gross margins for electric vehicles, excluding car rental and carbon credits, will fall below 20 per cent, based on the average selling price of all Tesla models at about $47000, according to investors. Tesla executives believe that, at least according to the current data, the gross profit margin of the company's electric vehicles will be higher than this index.

The next investor question is whether Musk's comments on social media Twitter will have a negative impact on the Tesla brand. Musk says he has about 127 million followers on Twitter and is growing. "it shows that I am quite popular," Musk said. "Twitter is very strong in driving up Tesla's market demand, so I encourage global car brands to use Twitter. I think Twitter is a very powerful tool to drive market demand."

Investors also asked about the climbing and mass production of Tesla 4680 battery and car computer Hardware 4. Tesla executives say the Tesla super factory is steadily ramping up the production of 4680 batteries. Musk also confirmed that the Hardware 4 will be launched along with Cybertruck electric pickup trucks. Musk said that after the launch of the Cybertruck electric pickup, he plans to open it every day.

The next investor asked about Kirkhorn Tesla's insurance business. Kirkhorn said it may take some time for Tesla's insurance business to reach the announced scale. He added that at present, the growth rate of Tesla's insurance business is 20% in a single quarter, and the proportion of customers buying Tesla insurance after picking up their cars is also very high. Musk added that Tesla's insurance business is a good closed loop for the company. Tesla's insurance business allows the company to adjust the car's design and software to minimize maintenance costs, he said. "of course, work on after-sales maintenance services is still going on," Musk said. "in fact, we are solving the problem of how to repair the car quickly and effectively and return it to the customer."

Some investors asked about the production progress of the Cybertruck electric pickup truck. Musk said the company aims to start producing Cybertruck electric pickups in the summer of 2023, but will be slow at first. "I'm not going to overstock when I start production," he said. " He stressed that mass production is really important. "Mass production is very important and will begin in 2024."

Next up is the analyst's question session.

Analysts at rating agency Wolfe Research asked about the expected production target of 1.8 million electric vehicles in 2023. Musk said that Tesla can actually produce 2 million electric cars this year, but because there may be a lot of force majeure events, it is best to be conservative. In other words, Tesla's production capacity is closer to 2 million vehicles than 1.8 million vehicles.

Analysts at New Street Research, a market research firm, asked Tesla how long it would take for the Texas super-factory and the Berlin super-factory to produce 36000 vehicles a month. Mr Kirkhorn said Tesla's two factories may not produce 36000 vehicles a month this year, but progress is certain. As for the inefficiency of production at factories in Texas and Berlin, Kirkhorn thinks it will improve this year.

Tesla executives also said that the production of models such as Model 3 and Model Y is now mature, and the company is constantly finding areas where costs can be further optimized. The company is learning about car power systems and other aspects, so that it can reduce costs by constantly improving car design and help to further improve profit margins.

Analysts at market research firm New Street Research also asked Tesla if car owners' acceptance of the FSD system was improving. Musk says the number of users using FSD is growing very strongly. "with each gradual upgrade, people's enthusiasm increases," he said. " He added that Tesla hopes to start using the supercomputer Dojo by the end of this year. "Tesla is really one of the most advanced artificial intelligence companies," Musk said. "

Analysts at market research firm Piper Sandler asked about the number of FSD systems activated in the fourth quarter and related deferred revenue. Kirkhorn just explained that Tesla has two business lines in this area, one is the FSD system, which is currently under test, and the other is the advanced driving assistance system Enhanced Autopilot. The analyst also asked about battery production in Nevada superfactories and how 4680 batteries produced in Nevada factories would be distributed in the future. Musk responded that there was too much speculation, but not all 4680 batteries from the Nevada battery factory would be used in Semi electric heavy trucks.

Another analyst asked which company Tesla thought his main competitor would be in five years' time. Mr Musk said Tesla was not clear about this. He said that in the field of autopilot alone, Tesla really seems to be far ahead of the second place. "We really don't know who will be the distant second place."... now I don't think you can see it through binoculars. "

He also stressed that Tesla currently has no competitors in the electric car market, but Chinese automakers are likely to be second only to Tesla because they work hard and are smart. "they work the hardest and they are the smartest," Musk said. Musk also said that on the whole, Tesla won the victory in the Chinese market with his own strength.

Analysts also asked Tesla if he wanted to speed up production of commercial vehicles other than Semi. Musk confirmed that Tesla would do so, but the company has not yet announced a new product.

Analysts at Truist, an investment bank, mentioned Tesla's progress in artificial intelligence and asked if the company could provide more details about the supercomputer Dojo and the humanoid robot Optimus. Mr Musk said Tesla's artificial intelligence was still in its early stages, but the supercomputer Dojo is expected to compete with the Nvidia H1 in 2023 and is expected to surpass it next year.

Morgan Stanley analysts asked Tesla if it was time to take advantage of the monopoly. Mr Kirkhorn said Tesla would use its monopoly advantage to make up for third-party supply and support the electric vehicle business. Musk also stressed that Tesla is taking a cautious strategy. "Tesla is in a good position to cope with the recession because the company has no debt and has $20 billion (currently about 135.6 billion yuan) in cash," he said. "

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