Tesla's stock price Wednesday surged following the release of its estimate-beating fourth quarter 2019 earnings report. Tesla also reported better-than-expected production and delivery numbers for Q4.
Tesla shot past earnings estimates, posting revenue of $105 million (56 cents a share) in Q4 year-on-year compared to $140 million (78 cents a share). It reported a two percent hike in revenue to $7.4 billion compared to $7.2 billion year-on-year.
Analysts polled by FactSet expected adjusted earnings of $1.77 a share on sales of $7 billion. Tesla also said it had attained profitability in Q4 as it did in Q3. Delivery numbers also beat records set in 2019 and 2018. Tesla reported deliveries of 112,000 electric vehicles (EVs) globally during Q4, a quarterly record. These deliveries were significantly higher than Wall Street estimates and contributed to the surge in Tesla's stock price.
Tesla delivered 367,500 EVs in 2019, a 50 percent increase year-on-year. This total was in line with its guidance range of 360,000 to 400,000 vehicles. The 2020 delivery guidance is a 36 percent jump over the 2019 deliveries.
Tesla has begun tooling to assemble the new Model Y crossover SUV at the Tesla Factory in Fremont, California.
The first models of this SUV should start rolling-off the assembly lines in March. Tesla will also build the Model Y at Gigafactory Europe to be constructed in Brandenburg, Germany starting 2021. Locals recently staged protests against the factory due to its alleged effects on the supply of water to residens.
Tesla delivered "a potentially game changing Q4 with strong profitability and healthy cash flow signaling what could be a new era for (Musk) and Fremont going forward," said Wedbush analyst Dan Ives.
Ives said the Q4 performance was "impressive, with clear momentum looking ahead as a global inflection in EV demand appears on the horizon." He said the Q4 performance was "impressive. Tesla faces clear momentum "looking ahead as a global inflection in EV demand appears on the horizon." Tesla's "bull party" looks likely to continue, he said.
During a conference call, Tesla CFO Zach Kirkhorn said the company expects "a one- to one-and-a-half-week delay in the ramp of Shanghai-built Model 3 due to a government-required factory shutdown" related to the raging coronavirus outbreak sweeping through China.
"This may slightly impact profitability for the quarter, but is limited, as the profit contribution from Model 3 Shanghai remains in the early stages," he said. "We are also closely monitoring whether there will be interruptions in the supply chain for cars built in Fremont," but Tesla so far is not aware of anything material.
