Global electric vehicle weather vane --$Tesla (TSLA.US)$Released this morningResults for the first quarter of 2024.

Although both revenue and profit fell short of expectations, and maintained the “significantly lower” automobile production/delivery growth rate guidelines in 2024, the company said it would speed up the launch of cheaper economy models and “punched in the face” to cancel media reports on the development of Model 2 a few days ago. Today's US stock market opened, and Tesla's stock price once soared by nearly 16%.

Specifically, Tesla's revenue for the first quarter of 2024 was US$21.3 billion, down 9% year on year. This is also the first time since 2020 (the Shanghai factory began to be built to sell cars and Model 3 began to sell) that Tesla's revenue grew negatively. According to some analysts, the current decline in revenue was even greater than the company's decline in 2020, when production disruptions caused by the pandemic were blamed.

By business, revenue from the automotive business fell 13% year on year to US$17.378 billion in the first quarter; revenue from the energy production and storage sector increased 7% year over year to US$1,635 billion, and gross profit surged 140% year over year to record highs; and service and other revenue increased 25% year over year to US$2,288 billion.

As the most important observation indicator of every quarter, Tesla's gross profit margin “held up” in the fourth quarter. The gross margin was 17.4%. Although it was lower than 17.6% in the previous quarter, it was still higher than the 16.9% expected by the market.

The gross margin of 17.4% in the first quarter was only 0.2 percentage points less than the previous quarter when delivery of the low-margin product Cybertruck began.

It is worth noting that Tesla's gross profit margin (decarbonization credit) gross margin in the first quarter was 15.6%, still hovering between 15-17%. Although it is down one percentage point from 16.6% in the previous quarter, it is still higher than market expectations.

Additionally, free cash flow for the first quarter was negative $2.5 billion, and the company attributed the negative change to $2.7 billion in inventory backlog and $1 billion in “AI infrastructure” capital expenditure.

The company still predicts capital expenditure of over $10 billion in 2024, and the market estimates $9.7 billion. Tesla expects capital expenditure in fiscal 2025 and 2026 to be between $8 billion and $10 billion.

Currently, the main focus of the market is where will Tesla grow in 2024 and the years after that? Is there still a Model 2? When will it be available? Wait a question. This time, Tesla clearly answered these questions.

In the performance guide, Tesla reiterated that it is “currently between two major growth waves (the platform period)”:

The first wave of growth began with the global expansion of the Model 3/Y platform, and we believe the next wave of growth will be triggered by advancements in autonomous driving and the launch of new products, including products built on our next-generation automotive platform. The future is not only electric, but also autonomous.

In 2024, our vehicle sales growth rate is likely to be significantly lower than in 2023, as we work to launch next-generation vehicles and other products. The revenue growth rate of our energy generation and storage business will surpass that of the automotive business this year.

Notably, Tesla still maintains its promise to start production of “new models” in the second half of 2025, and says it will accelerate the launch of more affordable models and special robot taxi Robotaxi products.

Also, during the conference call, Musk spent most of his time telling the market about Tesla's FSD technology and future AI plans.

Musk once again emphasized to Wall Street investment banks that Tesla is now an AI company, and he said that if investors don't experience FSD firsthand, it is impossible to truly understand this company.

If anyone doesn't believe Tesla can solve the problem of autonomous driving (FSD), they shouldn't be Tesla investors.

Meanwhile, Musk said that in the future, Tesla will operate millions of “robotaxis” (Robotaxis) to form a robot taxi fleet similar to Uber online car-hailing. Tesla owners will also have the opportunity to rent out their own Tesla cars to provide ride-hailing services, and plans to disclose more details about Robotaxi in August.

Siena Capital automotive analyst Chris Redl estimates that Tesla's confirmed deferred revenue from FSD this quarter was as high as 700 million US dollars. After deducting regulatory credit lines, this represents approximately 4.3% of Tesla's car revenue.

However, investors should note that after the earnings conference, Martin Viecha, who has been Tesla's long-term vice president of investor relations, announced that he will end his seven-year career at Tesla. This is also the third Tesla executive to announce his resignation in two weeks.

Ross Gerber, CEO of wealth management company Gerber Kawasaki, believes that the market has overestimated Musk's performance and Tesla's prospects. He said that Viecha is the glue between Tesla's management, shareholders and investors, and his departure from Tesla at the moment is very worrying.

Gerber pointed out that during this very important transition period, Tesla's management continued to lose experienced executives and was clearly not optimistic. Although he agreed with Musk's vision, he would like to see more signs of Musk combining words and actions.

After the results, Wall Street also disagreed on Tesla's subsequent trend: Citi raised the target price of Tesla's stock from $180 to $182; while the Royal Bank of Canada lowered the target price from $294 to $293; and UBS lowered the target price from $160 to $147.

Also, interchangeably, Tesla recorded a decline this Monday, for the seventh consecutive trading day (equivalent to the longest losing streak in history). However, after the first two consecutive days of decline, there was a violent rebound:

September 2018, next two months +50%

December 2022, next two months +100%.

Cow friends,

Do you think Tesla can usher in a strong rebound?

Welcome to leave your thoughts in the comments area~

Editor/Somer