Tesla’s first-quarter revenue report for the 2024 fiscal year in the United States fell short of expectations, but news of the upcoming launch of more affordable cars ultimately buoyed the stock, dispelling concerns over the financial performance.
On Tuesday, April 23, Tesla released its first-quarter revenue report for the 2024 fiscal year, with revenue amounting to $21.3 billion, a 9% year-on-year decrease. This marked the largest quarterly decline for Tesla since 2012 and fell below analysts’ expectations.
Currently, Tesla is facing intense competition within the industry and ongoing pressure from price reductions.
Tesla’s first-quarter financial report showed that the adjusted EPS for the quarter was $0.45 per share, below the expected $0.51 per share. Revenue of $21.3 billion also missed the anticipated $22.2 billion, with a significant slowdown expected in car production/delivery volume for the year 2024. However, the news of accelerating the launch of more affordable car models ultimately overshadowed the lackluster financial results, leading to a nearly 9% post-market stock increase.
According to the financial report, Tesla’s revenue in the first quarter of 2024 decreased compared to the same period last year when it stood at $25.17 billion. Net profit decreased by 55% from $2.51 billion a year ago to $1.13 billion.
The decline in sales this time was greater than that in 2020 due to production interruptions during the COVID-19 pandemic. In the first three months of 2024, Tesla’s automotive business revenue decreased by 13% year-on-year to $17.34 billion.
In its shareholder statement, Tesla stated that the sales growth rate may be significantly lower than that achieved in 2023 because the company aims to introduce “next-generation vehicles and other products.”
Due to concerns about weak deliveries, competition in the Chinese automotive market, and the company’s ongoing price reductions, Tesla’s stock price has plunged by over 40% this year. Earlier this month, Tesla announced an 8.5% year-on-year decline in first-quarter automotive deliveries.
During the Tuesday presentation, Tesla revealed that it is accelerating the launch of “new vehicles, including more affordable models,” which will be “able to be produced on the same production lines as Tesla’s current product line.”
Tesla’s goal is to “fully utilize” existing production capacity and achieve a production volume increase of “over 50% compared to 2023” before investing in new production lines.
Tesla’s energy department saw a 7% year-on-year revenue increase to $1.64 billion, while service and other revenue grew by 25% to $2.29 billion.
Tesla has already begun a large-scale reorganization this month. Tesla CEO Musk stated in a memo to the entire company last week that the car manufacturer would cut over 10% of its global workforce.
Some analysts view the introduction of budget-friendly Tesla models as crucial to achieving Musk’s sales growth ambitions. In 2020, he stated that Tesla aimed to sell 20 million vehicles by 2030, double the current sales volume of the world’s largest automaker, Toyota.