Tesla Q2 earnings preview: Why 2022 production target is key
It will be make-or-break for Tesla (TSLA) come Wednesday after the bell, as the electric vehicle maker releases its second quarter earnings report.
The Street is expecting Tesla to report:
Q2 Revenue: $16.88 billion
Q2 Adjusted EPS: $1.83
That revenue figure would represent a nearly $2 billion drop sequentially from a quarter ago, which reflects issues Tesla experienced during Q2 due to COVID-related shutdowns at its Shanghai Gigafactory.
On the profitability end, Tesla is expected to report adjusted net income, operating profit, and EBITDA figures that are higher than a year go, though lower sequentially.
Questions that will be top of mind will center around ramp ups at the Giga Texas and Giga Berlin plants, whether Giga China is back to full operating capacity, and whether Tesla will reaffirm its 2022 delivery target of 50% CAGR (compound annual growth rate) year over year. Maintaining that rate would mean Tesla will delivery around 1.4 to 1.5 million vehicles in 2022.
In a note to clients yesterday, Deutsche Bank analyst Emmanuel Rosner wrote that he expects Tesla will maintain its annual delivery target, which he says implies “considerable volume ramp in the second half."
Rosner added Tesla to the firm’s short-term “Catalyst Call Buy List,” advising clients to accumulate shares following Tesla’s pullback this year. As of this afternoon, Tesla stock is down 31% year to date, though it is still up 10% over the past year.