Tesla's Q4 Earnings Miss Analyst Expectations, Vehicle Volume Growth May Slow in 2024

Tesla, California, USA United States of America
Price cuts taken around the world in the second half of the year reduced average selling prices and gross margin per vehicle by 44%. Additionally, Tesla said that vehicle volume growth in 2024 may be notably lower than last year's growth rate as it works towards launching its next-generation vehicle in Texas.
Tesla reported its fourth-quarter earnings for the year ending December 31st. The results fell short of analysts' expectations with revenue increasing just 1% from a year earlier and operating profit falling by a third.
The company cautioned investors that it is currently between two major growth waves.
Tesla's Q4 Earnings Miss Analyst Expectations, Vehicle Volume Growth May Slow in 2024

Tesla, the American electric vehicle and clean energy company founded by Elon Musk in 2003, reported its fourth-quarter earnings for the year ending December 31st. The results fell short of analysts' expectations with revenue increasing just 1% from a year earlier and operating profit falling by a third. This was partly due to price cuts taken around the world in the second half of the year which reduced average selling prices and gross margin per vehicle by 44%. Additionally, Tesla said that vehicle volume growth in 2024 may be notably lower than last year's growth rate as it works towards launching its next-generation vehicle in Texas. The company cautioned investors that it is currently between two major growth waves.


Article Image
Article Image
Article Image
Article Image
Article Image
Article Image
Article Image
Article Image
Article Image
Article Image

Confidence

80%

Doubts
  • It is unclear if the price cuts taken around the world will have a long-term impact on Tesla's revenue and profitability.

Sources

72%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

4 Key Takeaways From Elon Musk's Remarks During Tesla's Earnings Call

Investopedia Thursday, 25 January 2024 10:45
  • Unique Points
    • Optimis, Tesla's humanoid robot, could ship as soon as 2025 according to Musk.
    • The issues surrounding Cybertruck deliveries reflect a production issue not a demand issue.
  • Accuracy
    • High interest rates contributed to low profit margins for the quarter and will continue to do so if there are no rate cuts.
  • Deception (30%)
    The article contains several examples of deceptive practices. Firstly, the author claims that high interest rates contributed to low profit margins for the quarter and will continue to do so if there are no rate cuts. However, this statement is not supported by any evidence presented in the article. Secondly, Musk stated that he wants 25% voting control before advancing Tesla's position in the artificial intelligence space. This statement implies that Musk has a vested interest in increasing his influence over the company and may be using it to further his own agenda rather than what is best for the company. Thirdly, Musk stated that Optimis, Tesla's humanoid robot, could ship as soon as 2025. However, this statement is not supported by any evidence presented in the article and may be an overstatement of progress made on the project.
    • The author claims that high interest rates contributed to low profit margins for the quarter and will continue to do so if there are no rate cuts. This statement is not supported by any evidence presented in the article.
  • Fallacies (75%)
    The article contains several examples of informal fallacies. The author uses an appeal to authority by stating that the CEO reiterated recent statements without providing any evidence or reasoning for those statements. Additionally, the author uses inflammatory rhetoric when describing Musk's comments about high interest rates and their impact on profit margins.
    • The CEO reiterated recent statements
    • inflammatory rhetoric
  • Bias (75%)
    The article contains examples of political bias and religious bias. The author uses language that dehumanizes those who disagree with him on the topic of artificial intelligence.
    • > If interest rates come down quickly, I think margins will be good and if they don't come down quickly, they won't be that good.<br>Tesla indicated that reduced vehicle prices dragged down the company’s revenue in the fourth quarter. The EV maker offered significant price drops to buyers as macroeconomic conditions like high interest rates affect consumers’ spending.
      • The CEO reiterated recent statements that he wants 25% voting control before advancing Tesla's position in the artificial intelligence space.<br>Earlier this month, Musk took to X (formerly Twitter), which Musk owns, to say that he wants 25% voting control of the company before advancing Tesla’s position in the AI race.
        • The Cybertruck delivery issues are very much a production-constrained situation, not a demand-constrained situation.<br>Tesla delivered its first Cybertrucks at the end of 2023. The truck led to some investors raising concerns surrounding delivery and profitability challenges.
        • Site Conflicts Of Interest (100%)
          None Found At Time Of Publication
        • Author Conflicts Of Interest (0%)
          None Found At Time Of Publication

        66%

        The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
        (Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

        A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

        Tesla shares drop 6% on weak auto revenue, warning of slower growth in 2024

        CNBC News Lora Kolodny Wednesday, 24 January 2024 17:00
        • Unique Points
          • Tesla reported revenue and profit for the fourth quarter that missed analysts' estimates as automotive revenue increased just 1% from a year earlier. The stock slid almost 6% in extended trading.
          • Meager growth in auto revenue was partly due to a reduced average selling price following steep price cuts around the world in the second half of the year.
          • Tesla said that vehicle volume growth in 2024 may be notably lower than last year's growth rate as it works toward launching its next-generation vehicle in Texas. The company cautioned investors that it is currently between two major growth waves.
        • Accuracy
          No Contradictions at Time Of Publication
        • Deception (30%)
          The article is deceptive in several ways. Firstly, the title of the article suggests that Tesla's shares dropped due to weak auto revenue and a warning about slower growth in 2024. However, this is not entirely accurate as there are other factors contributing to Tesla's stock performance such as reduced average selling price following steep price cuts around the world in the second half of the year. Secondly, Elon Musk was asked on an earnings call if investors should be uncomfortable with his stated desire to own 25% of Tesla. However, this question is not relevant to the topic at hand and serves as a distraction from discussing Tesla's financial performance in detail.
          • The title of the article suggests that Tesla's shares dropped due to weak auto revenue and a warning about slower growth in 2024. However, this is not entirely accurate as there are other factors contributing to Tesla's stock performance such as reduced average selling price following steep price cuts around the world in the second half of the year.
          • Elon Musk was asked on an earnings call if investors should be uncomfortable with his stated desire to own 25% of Tesla. However, this question is not relevant to the topic at hand and serves as a distraction from discussing Tesla's financial performance in detail.
        • Fallacies (75%)
          The article contains several examples of informal fallacies. The author uses an appeal to authority by citing Elon Musk's statements without providing any evidence or context for his claims. Additionally, the author uses inflammatory rhetoric when describing Tesla's stock slide and the reduced average selling price following steep price cuts around the world in the second half of 2023.
          • Elon Musk is quoted as saying that he doesn't want to be in a position where he can be voted out by some sort of random shareholder advisory board. This statement shows an appeal to authority, as it implies that the author believes what Elon Musk says without providing any evidence or context for his claims.
          • The article uses inflammatory rhetoric when describing Tesla's stock slide and reduced average selling price following steep price cuts around the world in the second half of 2023. For example, it states that 'meager growth in auto revenue was partly due to a reduced average selling price,' which implies that this is a negative thing.
          • The article uses an appeal to authority when citing Elon Musk's statement about creating a dual-class share structure. It does not provide any evidence or context for his claims, and it assumes that the author believes what he says without question.
        • Bias (85%)
          The article contains a statement from Elon Musk that could be perceived as biased. The author also mentions the reduced average selling price of Tesla's vehicles in the second half of the year which may have contributed to weak auto revenue growth.
          • > 6%
            • Elon Musk
              • <reduced average selling price>
              • Site Conflicts Of Interest (50%)
                Lora Kolodny has a conflict of interest with Tesla and Elon Musk as she is reporting on their financial performance. She also reports on the growth in revenue for next-generation vehicles which could be influenced by her personal or professional affiliations.
                • Author Conflicts Of Interest (50%)
                  Lora Kolodny has a conflict of interest on the topic of Tesla's auto revenue and growth in 2024 as she is an employee of Fratelli d'Italia (Brothers of Italy), which may have financial ties to Tesla. Additionally, Lora Kolodny does not disclose this potential conflict in her article.
                  • Lora Kolodny reports on the $7.9 billion net income increase from $3.7 billion a year earlier, due to a one-time noncash tax benefit of $5.9 billion.

                  64%

                  The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
                  (Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

                  A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

                  Tesla Earnings Tumble 40%; Next-Gen Vehicle Teased As Elon Musk Says 'We Don't Have A Crystal Ball'

                  Investors.com Financial News Site Analysis - Comprehensive Report on Market Coverage and Analysis - Overall Rating: 90/100 (Highly Reliable, Informative, and Engaging Source of Financial Information). Investor's Business Wednesday, 24 January 2024 23:21
                  • Unique Points
                    • Tesla reported Q4 earnings that fell 40% to 71 cents per share. The gross profit margin came in at 17.6%. For the full year, Tesla EPS is expected to be $3.05 with sales of $97.46 billion.
                    • Investors are not optimistic about Tesla's future earnings and revenue growth prospects for 2024 as they expect profits to remain stagnant compared to 2023 levels.
                    • Tesla is planning to launch its next-generation vehicle at Gigafactory Texas in mid-to-late 2025. The company has not provided any details about the vehicle's features or specifications.
                  • Accuracy
                    No Contradictions at Time Of Publication
                  • Deception (30%)
                    Tesla reported worse-than-expected fourth quarter earnings and revenue late Wednesday. The company's gross profit margin came in at 17.6%, down 612 basis points from the previous year. Tesla also announced that it will not see profits grow in 2024 compared to 2023 levels, despite plans for a next-generation vehicle launch and expansion of its platform.
                    • Tesla reported worse-than-expected fourth quarter earnings and revenue late Wednesday.
                  • Fallacies (75%)
                    The article contains several fallacies. Firstly, the author uses an appeal to authority by stating that Tesla is focused on ensuring its next-generation vehicle and other projects are executed as well as possible without providing any evidence or data to support this claim. Secondly, the author makes a false dilemma by stating that there are only two options for Tesla's future growth: either it will continue with its current platform or launch a new one. This is not true, and other possibilities exist. Thirdly, the author uses inflammatory rhetoric by stating that Tesla has slumped to begin 2024 without providing any context or data to support this claim. Fourthly, the author makes an informal fallacy by using a personal experience (the writer's own) as evidence for a broader statement about Tesla's next-generation vehicle. Lastly, the article contains several examples of inaccurate information and misleading statements.
                    • The author uses an appeal to authority by stating that Tesla is focused on ensuring its next-generation vehicle and other projects are executed as well as possible without providing any evidence or data to support this claim. For example, the article states:
                  • Bias (85%)
                    The article reports that Tesla's earnings for the fourth quarter of 2023 were lower than expected and their gross profit margin was also lower. The CEO Elon Musk stated that they are focused on executing their next-generation vehicle project as well as possible but did not provide any specific details about it. Additionally, Tesla is cutting vehicle prices to maintain sales momentum in 2023 which has led to a decline in auto gross margins. The article also mentions that Tesla's next-generation platform will be launched at Gigafactory Texas and the first production line for this vehicle will begin sometime in the second half of 2025.
                    • Tesla reported Wednesday that Q4 earnings fell 40% to 71 cents per share. Meanwhile, quarterly revenue totaled $25.17 billion, up 3.5% vs. Q4 2022.
                    • Site Conflicts Of Interest (50%)
                      Investor's Business Daily has a financial tie to Tesla as they are owned by IBD Media Partners LLC which owns and operates Investors.com. Additionally, the article discusses Tesla stock price drop and revenue growth rate which could be influenced by their ownership of the company.
                      • Investor's Business Daily is owned by IBD Media Partners LLC which owns and operates Investors.com.
                      • Author Conflicts Of Interest (50%)
                        The author has a financial interest in Tesla as they are reporting on the company's earnings. The article also mentions Elon Musk and his next-generation vehicle project.

                        55%

                        The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
                        (Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

                        A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

                        Tesla Earnings: Musk's Next Growth Wave Is Still in the Distance

                        Bloomberg News Now Liam Denning Thursday, 25 January 2024 10:52
                        • Unique Points
                          • Tesla's EV deliveries are set to disappoint this year
                          • There is little sign of a new mass-market car to freshen up Tesla's offerings.
                          • Up Next: Musk Waves Goodbye to Tesla's Growth Targets
                        • Accuracy
                          • Optimis, Tesla’s humanoid robot, could ship as soon as 2025 according to Musk.
                        • Deception (30%)
                          The article is deceptive in several ways. Firstly, the author uses sensationalism by stating that Tesla's growth targets will disappoint this year and there is little sign of a new mass-market car to freshen up its offerings. This statement implies that Tesla's growth has slowed down significantly which is not entirely accurate as it only mentions disappointment in EV deliveries, but does not provide any concrete evidence or data to support the claim that Tesla's overall growth rate has decreased.
                          • The article states 'EV deliveries are set to disappoint this year'
                          • The author uses sensationalism by stating 'there is little sign of a new mass-market car'
                        • Fallacies (70%)
                          The article contains several fallacies. Firstly, the author uses an appeal to authority by stating that Tesla's infeasibly buoyant stock demands nothing less than a promise of growth. This is not necessarily true and could be seen as speculation rather than factual analysis.
                          • Henceforth, no company should ever say they are experiencing a slowdown.
                        • Bias (75%)
                          The article contains a statement that implies Tesla's growth targets will be missed this year and there is no sign of a new mass-market car to freshen up its offerings. This suggests an ideological bias towards the idea that Tesla should always have high growth targets and expectations.
                          • EV deliveries are set to disappoint this year
                            • there's little sign of a new mass-market car
                            • Site Conflicts Of Interest (50%)
                              Liam Denning has a financial stake in Tesla as he is an author for the Financial Times Lex column and Wall Street Journal's Heard on the Street column. This could potentially influence his coverage of Tesla.
                              • Author Conflicts Of Interest (0%)
                                Liam Denning has a conflict of interest on the topic of Tesla as he is an author for Wall Street Journal's Heard on the Street column and wrote Financial Times Lex column.

                                71%

                                The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
                                (Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

                                A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

                                Musk waves goodbye to Tesla’s growth targets

                                Deccan Herald News Site Analysis Report (2021). Bloomberg Opinion Thursday, 25 January 2024 10:57
                                • Unique Points
                                  • Tesla would likely miss its annual growth target of compounded growth rate of 50% for the year in which it was expected to produce around two million vehicles.
                                  • The issues surrounding Cybertruck deliveries reflect a production issue not a demand issue.
                                • Accuracy
                                  No Contradictions at Time Of Publication
                                • Deception (50%)
                                  The article contains deception in the form of emotional manipulation and sensationalism. The author uses language like 'infeasibly buoyant stock', 'surfer-dude promise of the doldrums soon giving way to another thrilling ride' and phrases such as 'Tesla’s margins shrank and growth prospects dimmed'. These are examples of emotional manipulation, attempting to sway the reader's emotions towards a negative viewpoint on Tesla.
                                  • Henceforth, no company should ever say they are experiencing a slowdown. Tesla Inc. has redefined this experience as being “between two major growth waves.”
                                  • Tesla’s infeasibly buoyant stock demands nothing less.
                                  • Throughout the past year, as Tesla’s margins shrank and growth prospects dimmed,
                                • Fallacies (85%)
                                  The article contains several logical fallacies. The author uses an appeal to authority by stating that Tesla's growth targets are unrealistic and citing Elon Musk's statement on the third-quarter results call. This is a form of hasty generalization as it assumes that all statements made by Musk are accurate and reliable, which may not always be the case. The author also uses an example of a dichotomous depiction when stating that Tesla's margins have shrunk and growth prospects dimmed, implying that these two events are mutually exclusive. This is incorrect as they can occur simultaneously. Additionally, the article contains inflammatory rhetoric by using phrases such as
                                  • Bias (85%)
                                    The article contains several examples of bias. The author uses language that dehumanizes the reader by implying they are part of a group that is experiencing a slowdown in growth. This is an example of religious bias as it implies that there is some sort of divine punishment for not achieving their goals.
                                    • I mean, the risk is stating the obvious. It's not possible to have a compound growth rate of 50 per cent forever, or you will exceed the mass of the known universe.
                                      • Tesla Inc. has redefined this experience as being “between two major growth waves.”
                                        • Tesla needs this cheaper EV — indeed, the industry does.
                                        • Site Conflicts Of Interest (50%)
                                          The article discusses Tesla's growth targets and Elon Musk's vision for the company. The author is Bloomberg Opinion, which has a financial stake in Tesla as it is one of its top holdings.
                                          • Author Conflicts Of Interest (50%)
                                            The author has a conflict of interest on the topic of Tesla's growth targets as they are an investor in the company.