Tesla smashed Wall Street estimates for revenue and profit in another record quarter on Wednesday, despite a tumultuous few months for its CEO, Elon Musk, and ongoing supply chain concerns.
The electric car manufacturer reported $18.8bn in revenue for Q1 of 2022, up 81% from a year earlier. The report beat analyst expectations of $17.8bn, sending Tesla shares up 4% in after hours trading.
The company acknowledged in a statement that challenges including a large increase in prices for some of its raw materials coupled with supply chain issues have “remained persist”.
“Our own factories have been running below capacity for several quarters as supply chain became the main limiting factor, which is likely to continue through the rest of 2022,” Tesla said in a statement.
Those issues have been exacerbated by Covid-19 outbreaks, chip shortages, and the crisis in Ukraine. Tesla has in response raised prices of its products in China, the US, and other countries.
Wednesday’s report came as Musk took the market on a rollercoaster by revealing this month that he had quietly become a major shareholder in Twitter and then offering to buy the company outright.
There are concerns that Musk may sell some Tesla stocks or borrow against additional Tesla shares to finance his $43 bid to buy Twitter.
The results also come amid several legal challenges for the founder and his company. On Wednesday, Musk requested a federal judge to allow him to speak freely about a lawsuit accusing him of deceiving Tesla shareholders, which was settled this week. The settlement included a gag order that Musk and his attorneys called unconstitutional. Tesla is also facing multiple discrimination laws.
Investors will be watching to see Musk’s outside interests, including his bid for Twitter, affect the entrepreneur’s ability to successfully run Tesla, said Alyssa Altman, analyst at the consultancy firm Publicis Sapient.
“It is critical that he continues to instill confidence that he has his hands on the wheel and is driving the complex business of Tesla in the right direction,” she said.
More details soon…