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Tesla Reports Better Than Expected Earnings on Price Increases; Overall Revenue Down

Driven by the price increases, the Austin, Texas-based electric vehicle automaker bested analysts expectations by posting a profit of $2.27 (2.22 euro) per share versus a consensus of $1.81 (1.77 euro).
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Photo: Tesla
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Tesla's record revenue streak ended with total revenue falling from $18.76 billion (18.37b euro) to $16.93 billion (16.58b euro) and coming in below analysts estimated $17.1 billion (16.74b euro).

Global inflation conditions led to a decrease in automotive gross margin to 27.9%, lower than the previous quarter and last year.

A two-year record run of delivering vehicles by quarter also fell as the company delivered 254,695 vehicles from April to June versus 310,048 in the first quarter, a 17.9% drop. The company told Reuters supply chain issues and China's Covid-19 lockdown was to blame for decrease. The company's Shanghai, China factory was temporarily shutdown as well as those for suppliers in the country. The easing of the lock down will lead to production and delivery performance resuming in the second half of the year.

Despite the shutdown, June was the highest production month in China. The company remains optimistic in the wake of headwinds related to supply chain issues and parts shortages, believing they can still achieve their goal of a 50% increase in deliveries this year.

The company continues to see strong demand for the Tesla brand and has stated they have a supply problem, as opposed to a demand issue. That should improve with new factories in Berlin and Texas expected to be producing 5000 vehicles a week by year's end. The German factory's output in June was 1000 per week.

The company reported that supply issues continue for older generation microchips, but there are no major supply disruptions to hamper production goals.

Musk believes inflationary issues will subside by the end of the year and result in commodity price stabilization. He seemed much more optimistic recently after saying last month that he had a "super bad" feeling about the economy.
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