Tesla Quarterly and Annual Performance Briefing (Q1 2023 - Q4 2024)
Sources: Tesla Motors – First Quarter 2023 Shareholder Letter
Tesla Motors, Inc. – Second Quarter 2023 Shareholder Letter
Tesla Motors, Inc.– Third Quarter 2023 Shareholder Letter
Tesla Motors, Inc.– Fourth Quarter & Full Year 2023 Shareholder Letter
I. Executive Summary
Tesla's financial performance and operational highlights from Q1 2023 through Q4 2024 demonstrate a strategic focus on expanding production, investing in advanced technology like autonomy, and diversifying revenue streams beyond automotive sales. While Q1 and Q2 2023 showed strong growth in production and deliveries, the latter half of 2023 and early 2024 saw a slight slowdown in automotive revenue and production/delivery growth. However, Tesla anticipates a return to vehicle growth in 2025, driven by new product introductions and advancements in autonomy. The company maintains a strong financial position, with increasing cash and investments, and a commitment to its long-term production CAGR target.
II. Key Financial Highlights
Net Income (Non-GAAP):
Q1 2023: $2.9B
Q2 2023: $3.1B
Q3 2023: $1.853B (GAAP) / $2.485B (non-GAAP)
Q4 2023: $7.928B (GAAP) / $2.485B (non-GAAP) - Note: Significant GAAP net income in Q4 2023 likely due to a one-time adjustment, as non-GAAP net income remained consistent.
Q1 2024: $1.129B (GAAP) / $1.536B (non-GAAP)
Q2 2024: $1.478B (GAAP) / $1.812B (non-GAAP)
Q3 2024: $2.167B (GAAP) / $2.505B (non-GAAP)
Q4 2024: $2.317B (GAAP) / $2.566B (non-GAAP)
Total Revenues:
Q1 2023: $23.329B (24% YoY growth from Q1 2022)
Q2 2023: $24.927B (47% YoY growth from Q2 2022)
Q3 2023: $25.167B
Q4 2023: $21.301B
Q1 2024: $25.500B
Q2 2024: $25.182B
Q3 2024: $25.707B
Q4 2024: $25.707B (2% YoY growth from 2023 annual total)
Gross Margin:
Total GAAP Gross Margin has seen a declining trend, from 19.3% in Q1 2023 to 16.3% in Q4 2024.
"Total GAAP gross margin 29.1% (Q1 2022) ... 19.3% (Q1 2023) -977 bp"
"Total GAAP gross margin 18.2% (Q2 2023)"
"Total GAAP gross margin 17.6% (Q3 2023) ... 16.3% (Q4 2024)"
Operating Margin: Also shows a declining trend, from 11.4% in Q1 2023 to 6.2% in Q4 2024.
"Operating margin 11.4% (Q1 2023) -779 bp"
"Operating margin 9.6% (Q2 2023)"
"Operating margin 8.2% (Q3 2023) ... 6.2% (Q4 2024)"
Cash and Investments: Consistently increasing, demonstrating strong liquidity.
Q1 2023: $22.4B (+$0.2B increase QoQ)
Q2 2023: $23.1B (+$0.7B increase QoQ)
Q3 2024: $33.648B
Q4 2024: $36.563B
Free Cash Flow: Showed quarterly fluctuations but generally strong, with a dip in Q1 2024.
Q1 2023: $0.4B
Q2 2023: $1.0B
Q3 2024: $2.742B
Q4 2024: $2.031B
III. Operational and Production Updates
Vehicle Production & Deliveries:
Record Production: Q1 and Q2 2023 saw record vehicle production. "In Q1, we produced a record number of vehicles..." (Q1 2023). "In Q2, we produced a record number of vehicles..." (Q2 2023).
Overall Growth Trend: Total annual deliveries increased from 1,313,851 in 2022 to 1,808,581 in 2023, but slightly decreased to 1,789,226 in 2024.
Model Y Dominance: "Model Y was the best-selling vehicle in Europe in Q1" (Q1 2023). "Model Y was the best-selling vehicle in the US in Q1 (ex-pickups)" (Q1 2023). "Model Y became the best-selling vehicle globally in Q1" (Q2 2023). Model Y continued to be a top seller in Europe throughout 2024.
Factory Ramps & Capacity:
Austin & Berlin Ramps: Ongoing ramps at Gigafactories Austin and Berlin contributed to record production in early 2023.
Shanghai Near Full Capacity: "Since our Shanghai factory has been successfully running near full capacity for several months, we do not expect meaningful increase of weekly production run rate." (Q1 2023). Shanghai achieved its 3-millionth vehicle produced and 1-millionth vehicle exported by October and September 2024 respectively.
Cybertruck: Factory tooling "on track" in Q1 & Q2 2023. Producing "Alpha versions" in Q1 2023 and "RC4 builds" in Q2 2023. Initial deliveries expected in 2023, with production increasing sequentially in Q3 2024 and achieving positive gross margin for the first time. Production rate for 4680 cells for Cybertruck exceeded 2.5k Cybertrucks/week by Q4 2024.
Total Annual Vehicle Capacity: Steadily increasing, reaching over 2.35 million units by Q3 2024 (California: 650,000; Shanghai: 950,000; Berlin: 375,000; Texas: 375,000). The company plans for a total capacity of "close to three million vehicles, enabling more than 50% growth over 2023 production before investing in new manufacturing lines." (Q3 2024).
Energy Storage:
Significant YoY growth: 360% in Q1 2023 (to 3.9 GWh), 222% in Q2 2023 (to 3.7 GWh), 75% in Q3 2024 (to 6.9 GWh), and 114% in 2024 annually (to 31.4 GWh).
Megafactory Ramp: The Lathrop, CA Megafactory ramp is successful, and a second 40 GWh Megafactory in Shanghai was announced in Q1 2023, with construction starting later that year.
"Our Energy and Services and Other businesses are becoming increasingly profitable parts of Tesla." (Q3 2024).
Supercharger Network: Continues to expand.
Q1 2023: 4,947 stations, 45,169 connectors.
Q2 2023: 5,265 stations, 48,082 connectors.
Q3 2024: 6,706 stations, 62,421 connectors (20% & 22% YoY growth respectively).
Q4 2024: 6,975 stations, 65,495 connectors (17% & 19% YoY growth respectively).
IV. Core Technology Advancements
Autopilot and Full Self-Driving (FSD):
Data Collection: Over 150 million miles driven with FSD Beta by Q1 2023, recognized as "unprecedented in the industry." This level of data collection is "essential for AI-based approach – the only approach we believe can work for scalable autonomy." (Q1 2023).
Software Updates: Latest FSD Beta software stack enabled for highway driving in Q1 2023. FSD (Supervised) miles reached 2.8 billion by Q4 2024, with V12 showing rapid adoption.
Dojo Training Computer: Production started in July 2023, aiming for "faster and cheaper neural net training." Projected to be among the "Top 5 in the Entire World" by January 2024 in terms of compute power (300,000 A100 GPU equivalent by Oct 2024).
"Autonomy will further accelerate our mission." (Q3 2024).
New Vehicle Platforms & Technologies:
Cybertruck Innovations: Features include "Stainless Steel Exoskeleton," "Integrated Audio with Body Structure," "48-Volt Electrical Architecture" (reduces current by 4x, heat by 16x), "800-Volt Battery System" (more energy efficient for high power vehicles), "Steer-by-Wire" (removes mechanical steering column), and "Rear Wheel Steering" (improves turning radius and high-speed stability). Many of these technologies are marked for "Use in Future Vehicles." (Q4 2024).
Next Gen Platform: "Next Gen Platform - In development" (Q2 2023). "Cybercab and Robovan vehicles, both designed from the ground up for autonomy – without a steering wheel or pedals" were unveiled in October 2024, to be built on this platform with an estimated 5.5 mi/kWh powertrain, "our most efficient powertrain yet." (Q3 2024).
Affordable Models: Plans for "new products in 2025, including more affordable models" are underway, utilizing aspects of both current and next-generation platforms, produced on existing manufacturing lines. (Q4 2024).
Battery & Powertrain:
4680 Cell Production: Production rate continued to improve sequentially in Q1 2023. "In Q3, we produced our 100-millionth 4680 cell and continued to progress our dry-cathode manufacturing lines." (Q3 2024).
Lithium Refinery: First spodumene processed through the front-end of the lithium refinery only 18 months after groundbreaking by Q4 2024, with commissioning on track for 2025.
V. Strategic Outlook
Volume Growth: Tesla aims to "grow production as quickly as possible in alignment with the 50% CAGR target we began guiding to in early 2021." (Q1 & Q2 2023). For 2023, they expected to exceed this with "around 1.8 million cars for the year." (Q1 & Q2 2023).
However, "Our company is currently between two major growth waves: the first one began with the global expansion of the Model 3/Y platform and we believe the next one will be initiated by advances in autonomy and introduction of new products..." (Q3 2024).
"Despite ongoing macroeconomic conditions, we expect to achieve slight growth in vehicle [volume]" in the interim, but anticipate a "return to growth in 2025" with new products and autonomy advancements. (Q3 & Q4 2024).
Energy storage deployments are expected to "grow at least 50% year-over-year in 2025." (Q4 2024).
Pricing Strategy: "Our near-term pricing strategy considers a long-term view on per vehicle profitability given the potential lifetime value of a Tesla vehicle through autonomy, supercharging, connectivity and service." Pricing is expected to "continue to evolve, upwards or downwards, depending on a number of factors." (Q1 2023).
Profitability Evolution: "over time, we expect our hardware-related profits to be accompanied by an acceleration of AI, software and fleet-based profits." (Q4 2024).
Financial Stability: The company reiterates "sufficient liquidity to fund our product roadmap, long-term capacity expansion plans and other expenses," and a commitment to "maintain a strong balance sheet during this uncertain period." (Q1, Q2, Q4 2023, Q4 2024).
VI. Other Notable Information
Market Leadership: Model Y was the best-selling vehicle in Europe and the US (ex-pickups) in Q1 2023, and globally in Q1 2023 (Q2 2023 Update). Model Y continued to be a leading seller in several European countries in 2024 and became the best-selling EV of all time in Norway.
Cost Efficiency: Efforts to reduce cost per vehicle are ongoing, including smoothing deliveries throughout the quarter and sequential improvements in cost of goods sold per vehicle at Shanghai and Berlin factories. Tesla's average COGS per vehicle reached an all-time low in Q4 2024.
Tesla Semi: "Pilot production" in Nevada (Q1 & Q2 2023). Factory construction continued through Q4 2024, with first truck builds scheduled for late 2025 and ramp in early 2026.
Robotaxi: "In development" (Q1 2023). "Purpose-built Robotaxi product will continue to pursue a revolutionary “unboxed” manufacturing strategy." (Q3 2024).
Total Vehicles Produced: Tesla produced its 7-millionth vehicle by October 22, 2024.
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