Tesla (TSLA) surged almost +11% day after results (27 Jan) after reporting Q4 2022 earnings (26 Jan) after market close.
Source: Google Finance
Tesla beat on both revenue and EPS, but guided for less than 40% growth for 2023 vehicle deliveries of 1.8M cars.
Source: Forex Live
Read: Tesla $1.19 vs $1.13 estimate. Revenues beat expectations as well
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Focus on costs
In the Shareholder Deck and on the conference call, my main takeaway was that Tesla management is focused on driving down costs. In view of the short-term impact of macro uncertainty and rising interest rates, Tesla’s response is to accelerate their cost reduction roadmap which would also reduce the impact of price cuts on margins. Tesla management also clarified their focus will primarily be on operating margins (i.e. not just gross margins which the market was focused on).
As average selling prices (ASP) continues to decline, Tesla’s operating margins have been...
