Tesla profits soar on record car deliveries Business

Tesla revealed a massive surge in sales and profits on Wednesday night, shattering Wall Street expectations despite supply chain issues.

The company, run by billionaire Elon Musk, said its revenue rose from $10.4bn (£8bn) to $18.8bn in the first quarter.

Analysts expected $17.8 billion.

At the same time, the company – which makes Britain’s best-selling cars, the Model 3 and Model Y – said profits had risen from $438m a year ago to $3.3bn of dollars.

It came after Tesla delivered a record 310,048 cars in the first three months of 2022, compared to 184,800 in 2021.

This is despite global microchip shortages that have significantly hampered some other automakers, as well as rising material costs related to Russia’s invasion of Ukraine.

The company said it was “focused on growing as quickly as reasonably possible”, but supply chain issues “remain lingering”.

That forced the company to raise prices, Tesla added.

Shares jumped more than 3% in after-hours trading following the announcement.

Meanwhile, Tesla has opened factories in Texas and Berlin and is ramping up production, with Mr. Musk personally delivering the first Model Y vehicles made in Texas earlier this month. The company began deliveries to Berlin in March.

The so-called gigafactories are part of his company’s plan to reduce vehicle manufacturing costs by building them closer to customers in major markets.

However, Tesla was forced to halt production at its Shanghai factory at the end of the first quarter due to a local Covid outbreak. It has since resumed production, apparently asking some staff to sleep there.

The results were partly overshadowed by the $43 billion takeover bid Mr Musk made on Twitter, the social network he has used for years to attract publicity for himself and Tesla.

In a tweet, the billionaire continued to hint at the possibility that he could turn his bid into a hostile bid with a “buy” offer to all shareholders.

His message included a series of dashes – representing a missing word – followed by the phrase “is the night”.

It came after he separately tweeted “Love Me Tender”, an Elvis Presley song, on Saturday after Twitter adopted so-called “poison pill” plans to torpedo any hostile offers.

The move, designed to prevent any shareholder from accumulating more than a 15% stake in the media company, would allow Twitter’s board to flood the market with stocks to dilute the predators’ stakes.

Mr Musk revealed he held a 9.1% stake earlier this month, making him Twitter’s biggest investor.

He was expected to join the company’s board of directors before it was abruptly announced that he would no longer do so and made a takeover bid for Twitter.

This week it was claimed that Mr Musk was ready to invest between $10 billion and $15 billion of his own money in the deal.

On top of that, it has tapped Wall Street banking giant Morgan Stanley to raise an additional $10 billion in debt and will launch a takeover bid within days, according to the New York Post.

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This notice was published: 2022-04-20 20:50:26

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