$Tesla (TSLA.US)$ The earnings conference will be released after the market closes on October 23, Eastern Time. Institutions expect its 2024 Q3 revenue to reach $25.674 billion, a 9.95% year-on-year increase; projected earnings per share of $0.5, a 5.96% year-on-year decrease.
Looking back at the previous quarter, although tesla's total revenue increased by nearly 2.3% year-on-year, returning to positive growth trajectory, exceeding market expectations. However, the actual sales revenue of autos fell short of expectations, delays in the Robotaxi launch event, and other bearish factors caused tesla's Q2 performance to drop by over 12%.
At the recent Robotaxi event day, despite Elon Musk making a series of commitments, the lack of crucial data and details failed to satisfy the market, causing tesla's stock price to drop by nearly 9% in a single day, still down over 11% since the beginning of this year.
Looking ahead to the third quarter report, investors will continue to focus on autos business revenue, the impact of price reductions on profit margins, the situation of energy storage business, and additionally, the progress of the Robotaxi project and its potential revenue contribution, the outlook for deliveries in the next two years, will also be key factors driving market reactions.
Autos business revenue: Q3 deliveries fell short of expectations, with gross margin likely to remain under pressure.
Reviewing the previous quarter, tesla's Q2 autos business total revenue was $19.878 billion, compared to $21.268 billion in the same period last year, a 7% year-on-year decrease; Q2 gross margin was 18%, a decrease of approximately 20 basis points compared to the same period last year.
Earlier this month, tesla also announced the third quarter auto delivery volume, delivering a total of 0.463 million vehicles, with year-on-year and quarter-on-quarter growth of 6.4% and 4.3% respectively, also achieving the first quarter-on-quarter sales growth this year.
However, although this delivery data reversed the slump of the previous two quarters, it still slightly fell below market expectations, mainly due to the lack of increase in demand for its outdated models. The delivery volume of its Model 3/Y reached nearly 0.44 million vehicles, exceeding market expectations.
Zacks analysts expect Tesla's automotive business revenue in the third quarter to increase by 13.1% to $22.19 billion year-on-year. However, high production costs and price wars will continue to put pressure on profit margins, with automotive gross margin expected to remain roughly the same as Q2, decreasing by 40 basis points year-on-year to 18.3%.
Energy storage business was a highlight last quarter, but is it receiving mixed reviews this quarter?
In the previous quarter, Tesla's energy generation and storage business revenue was $3.014 billion, doubling year-on-year; in the second quarter, the deployment of energy storage products Megapack and Powerwall reached 9.4Gwh, hitting a single-quarter historical high and becoming a major highlight in the Q2 financial report.
Tesla's Q3 energy storage deployment reached 6.9GWh, a 73.3% year-on-year increase; major banks expect energy storage business revenue to reach $2.17 billion, a 39.1% year-on-year increase.
However, analysts' evaluations of this business are mixed. Zacks is bullish on the company's energy storage business performance. The bank stated that its energy storage revenue shows a strong growth trajectory, and this department is highly profitable with the highest profit margins. In contrast, HSBC believes that the company's energy storage performance has significantly declined, falling short of the general Wall Street expectations, as mentioned by management before, energy storage deployment is often unstable.
Will Robotaxi's performance be able to turn the tide as the market remains unsatisfied with the report card?
On October 10th, Tesla showcased its groundbreaking global self-driving service vision to the world and introduced two new vehicle models: the autonomous taxi (Robotaixi) prototype Cybercab and the autonomous bus Robovan. At the same time, CEO Musk emphasized that the Robotaxi business represents a huge profit opportunity, positioning it as a cornerstone of Tesla's long-term global strategy.
According to Musk, Cybercab is expected to begin production in 2026, ramp up production to very high levels by 2027, and be priced at less than 0.03 million US dollars.
However, at the conference, the company did not delve into discussions on its business model, potential regulatory obstacles, or lack of key safety details. Additionally, there was no mention of revenue or market size forecasts, leading investors to be skeptical and put pressure on the stock price.
Therefore, in this earnings conference, if Tesla can comment on the launch schedule of Robotaxi, revenue forecasts, technical challenges, or regulatory environment, it is likely to generate a strong response from investors.
How has Tesla's performance been on past earnings days?
Tesla's current implied volatility is ±10.4%, indicating that the options market is betting on a single-day price change of up to 10.4% post-earnings. Compared to the previous four quarters where the post-earnings price change was approximately 11.5%, the current options value still appears slightly undervalued.
In the past 12 earnings days, Tesla has a 42% probability of increasing, with a maximum increase of 12.1% and a maximum decrease of -12.3%; the stock price volatility has had a probability of about 70% exceeding market estimates. Based on the options volatility skew, the current market sentiment towards Tesla is bullish.
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