Tesla has already reported vehicle shipping numbers for the second quarter, and now its full financial report for the second quarter of 2022 (pdf) reveals that it is dealing with inflation and the general economic recession, combined with falling prices of Bitcoin and other cryptocurrencies. In the letter to investors, Tesla executives reveal that the company has sold 75 percent of its Bitcoin holdings, adding $ 936 million in cash to its balance sheet.
Last year, Tesla made a $ 1.5 billion investment in Bitcoin and announced that it would accept Bitcoin as a payment. Tesla began accepting Bitcoin in late March, then turned sharply back in May, just 49 days later.
In the latest report, Tesla says the value of its remaining “digital assets” is $ 218 million, which had reported about $ 1.2 billion in previous quarters. Last July, Musk said, “I could pump, but I won’t throw … I definitely don’t believe in raising the price and selling it or anything for it. I wish Bitcoin was a success.”
Higher costs for raw materials and “deterioration of Bitcoin”
When it comes to its electric car manufacturing business, where it appears to be announcing new competitors every day, and solar products, the company reports that it made a profit of $ 2.26 billion this quarter, about a decrease of $ 31 billion. percent over last quarter when it posted. profits of $ 3.3 billion. The profit was made with revenue of $ 16.9 billion, which is also lower in the first quarter, where the company reported that it contributed $ 18.7 billion.
In terms of profitability, the company is still better than the second quarter of 2021, where it earned $ 1.1 billion with revenue of $ 11.9 billion. The company attributes this to several factors, such as “lower share-based compensation expense,” more vehicle deliveries compared to last year, and an improved average selling price. This is the first full quarter since Tesla raised the prices of all its cars by up to 10 percent and raised prices on select models again in June. Despite price increases, the company has broken with its tendency to earn more per car each quarter. In the first quarter, its gross automotive margin was 32.9 percent. This quarter, it was 27.9 percent.
Tesla announced earlier this month that its deliveries have slowed, falling about 18 percent compared to the first quarter. It also produced about 15 percent fewer cars this quarter compared to the previous one. In its earnings report, Tesla says it faced “limited production and shutdowns in Shanghai for most of the quarter,” but that it continued to increase production at its new facilities in Berlin and Austin, Texas. .
Other difficulties reported by the carmaker are rising prices in everything from raw materials to logistics, higher fixed costs per car due to closures in Shanghai and, of course, the aforementioned ” Bitcoin deterioration “.
Compared to the last quarter, the company’s revenue from the sale of regulatory credits to other carmakers fell nearly 50 percent. In the first quarter, it contributed $ 679 million in loans, and in the second quarter, it earned only $ 344 million. The credits help other companies that don’t manufacture enough “clean” vehicles to meet U.S. and EU regulatory standards.
Culturally, it has been a turbulent neighborhood for Tesla. In late April, CEO Elon Musk sold billions of dollars in company shares to help pay for Twitter (a deal that has been a big mess and is now going to the Delaware Chancellery after Elon tried to cancel the deal). Musk also said he has a “super bad feeling” about the economy when he announced the hiring freeze and layoffs at the company. These layoffs have affected the autopilot team, and Tesla has been accused of violating labor law after letting more than 500 Gigafactory workers leave. The company also lost its head of AI earlier this month.
Not all has been bad news, though. Tesla’s partnership with Uber and Hertz, where qualified car-sharing drivers can rent electric vehicles to carry passengers, seems to be going well according to an Uber report in June. It also looks like 2022 will be the year that non-Tesla electric vehicles will have access to the Supercharger network in the U.S., according to a fact sheet released by the White House.
The company will discuss its second-quarter results in an investor call at 5:30 p.m. ET / 2:30 p.m. PT, which you can listen to here.