Three months have passed since Tesla holders, analysts and fans heard Elon Musk talk about Tesla's financial performance.
It was Oct. 19 when Tesla last posted, for the third quarter. These results had disappointed the markets, but the chief executive tried to reassure all concerned.
"We're looking forward to a record breaking Q4," Musk told analysts in his opening remarks that day. "It looks like we'll have an epic end of year."
He added: "Q4 is looking extremely good."
While everyone waits to find out on Jan. 25 -- the scheduled reporting date -- whether the fourth quarter was indeed "epic," it's surely safe to say it was eventful and filled with disappointing announcements.
2022 Vehicle Deliveries Lagged the Estimates
The figures for vehicle deliveries for 2022, announced on Jan. 2, came in below expectations. Tesla delivered 1.31 million cars in 2022, up 40% year on year. But this was below the average 1.33 million analysts expected.
The automaker delivered 405,000 vehicles in the last three months of 2022, more than 5% below the 427,000 analysts expected.
Deliveries are the most reliable barometer of vehicle sales by Tesla, which has produced more cars than it has delivered. In 2022, production stood at 1.37 million vehicles, including 439,701 units in the fourth quarter.
Between Musk's promise and Dec. 31, Tesla stock lost nearly 45% of its value.
This stock-market rout provoked a harsh response from prominnshareholders like Leo KoGuan and Ross Gerber, who did not hesitate to criticize Musk publicly and to question the board.
For the first time, Musk, the architect of Tesla's success, found himself under fire from part of the Tesla community, which is essentially made up of his fans.
"Elon has now erased $600 bil of tesla wealth and still nothing from the Tesla [board of directors]," Gerber blasted out on Dec. 16 via Twitter. "It’s wholly unacceptable."
"I am 100% in Tesla bc I believe in Elon Musk and Tesla," KoGuan wrote on Twitter on Jan. 7. "But he is killing SH and Tesla. If I knew I wouldn’t invest in Tesla," KoGuan lamented on Jan. 7.
And finally, Tesla did something unprecedented. The automaker has cut its prices three times. The first was a drop of $3,750;, then came $7,500 in December, and on Jan. 12 the prices declined 7% to 20%, a slash unheard of in Tesla history.
For some analysts, Musk and Tesla have chosen volume sales at the expense of profit margins. But investors applaud the move because they see it as a way for Tesla to increase market share if its rivals do not react. Competitors like GM (GM) , Ford (F) and Rivian (RIVN) have less flexibility.
In view of all this news, the conference call on the Q4 results is eagerly awaited and promises to be very interesting, especially since there are also questions about the Cybertruck, Tesla's first pickup/truck.
"While every quarter is important for Tesla we would highlight tomorrow’s call/guidance commentary as one of the most important moments in the history of Tesla and for Musk," said Wedbush analyst Dan Ives.
Top 10 Questions
Here's a list of the top questions Tesla shareholders would like to ask Musk.
Tesla generally asks retail and institutional shareholders to ask and vote on questions they feel are important: "Tesla invites shareholders to ask and upvote questions that they would like addressed during their Q4 2022 Earnings," the company writes in a website.
More than 2,300 questions had been asked at last check. You can read the full list of them here.
-"Some analysts are claiming that Tesla orders net of cancellations came in at a rate of less than half of production in the fourth quarter. This has raised demand concerns. Can you elaborate on order trends so far this year and how they compare to current production rates?"
-"What has the initial reaction been to global price reductions early in 1Q23, specifically in terms of order intake levels?"
- "After recent price cuts, analysts released expectations that Tesla automotive gross margin excluding leases and reg credits will drop below 20% and average selling price around $47k across all models. Where do you see average selling price and gross margins after the price cuts?"
- "Will Tesla be able to take full advantage of advanced manufacturing production credits for battery cells/packs ($3,700 per LR 3/Y at $45/kWh for 82 kWh pack) for auto & energy products and how much does Tesla expect to earn in the coming year from these credits?"
-"Please provide a detailed explanation of where you are on the 4680 ramp. What are the current road blocks? When do you expect to scale to 10,000 vehicles a week?"
-"Zach, when do you think Tesla Insurance will become a big enough revenue source to warrant providing more details on the financials of that business so investors can compare it to other insurance companies?"
- "Is Cybertruck production still on track for mid year?"
- "With near-infinite global demand for energy storage, where should Tesla build the next MegaPack factories? How many are needed on each continent?"
-"The Solar Roof product continues to struggle to gain traction. What has Tesla learned from this and what changes do you foresee in future Solar Roof versions to increase scale."
- "What kind of margins do you expect for the stationary energy storage business in 2023 and then 2024 and beyond? Separately, will you consider reporting energy volumes in the P&D report?"
Beyond the Top 10 there are also the following:
- "When will Tesla announce production Cybertruck specs and pricing?"
- "Since Elon started political influencing, polls from Morning Consult & YouGov show Tesla brand favorability declining in 2022 and division along partisan lines. Such brand damage can impact demand. Does Tesla track favorability and how will any brand damage be mitigated?"
- "Has Tesla leadership considered finding someone similar to Gwynne Shotwell (SpaceX's president and COO) to help assist managing Tesla from the top as Twitter and Twitter posts continue to take time away from Elon?"
- "Do you still intend to buy back shares in Q3/Q4 this year?"
- "Will Tesla please create a very small and lean PR team to fight FUD [fear, uncertainty and doubt] and go after media outlets that disparage Tesla, similar to how Tesla China has been doing? Tesla China seems to be having success with this approach."
