On January 29, Tesla announced its fourth-quarter earnings for 2024 and there are bits of good news in the report, even if the company missed the mark in some areas. Arguably, the biggest news of this release is that Tesla’s gross profit margin fell to 16.3 percent, a decline of 3.5 percent compared to the third quarter of the year and still well off from 19 percent, which some analysts had predicted.
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How It Fared Financially
The manufacturer of all-electric vehicles reported gross revenues of $25.7 billion for the October-to-December period. This includes revenues from the company’s energy generation and storage division, various services, and, of course, the automotive business. All of this resulted in a total gross profit of nearly $4.2 billion.
Tesla brought in nearly $19.8 billion in total revenues from its automotive operations in Q4. Energy generation and storage accounted for around $3 billion while services and other revenue added just shy of $2.9 billion to the company’s coffers. Curiously, net income attributable to common stockholders (GAAP) clocked in at $2.3 billion for the fourth quarter, seemingly a great number, except that represents a drop of 71 percent compared to the same time period in 2023.
Looking at things for the entire year, Tesla’s overall 2024 revenues increased by 1 percent compared to 2023, clocking in at just short of $98 billion. Curiously, gross profit fell by the same percentage, hitting about $17.5 billion. Additionally, the company’s total automotive revenues declined by 6 percent to right around $77 billion last year. Net income attributable to common stockholders (GAAP) clocked in at around $7.1 billion, a year-over-year drop of 53 percent.
As for Tesla’s vehicles, the company produced nearly 460,000 cars in the fourth quarter, with the Model 3 sedan and Model Y SUV accounting for more than 436,000 of that total. For all of 2024, the firm assembled just shy of 1.8 million units, a year-over-year decline of 4 percent.
The Road Ahead
On January 29, Tesla’s stock closed at $389.10. The price sagged slightly after that and then started to climb. At the time of writing this article, the stock was going for around $405, so investors don’t appear to be spooked by the automaker’s huge drop in quarterly net income. Perhaps this behavior is because of Elon Musk’s legendary stage presence.
During their earnings call, the CEO mused that Tesla could become the most valuable company in the world – and by a huge margin – worth more than the next five biggest corporations combined.
He said their Optimus humanoid robot
could be the driver that delivers this incredible growth, though Musk has a long history of promising the world and then either failing to deliver or falling way behind schedule.
In the near term, however, more down-to-earth products will likely support the automaker’s bottom line. “We’re going to be launching unsupervised Full Self-Driving as a paid service in Austin (Texas) in June,” Musk said during the earnings call. The CEO added, “So, what I’m saying is, this is not some far-off, mythical situation, it’s literally [a] … five, six months-away type of thing.”
