Tesla Motors CEO Elon Musk unveils a new all-wheel-drive version of the Model S car in Hawthorne, California October 9, 2014.
Lucy Nicholson | Reuters
Tesla reports third-quarter results on Wednesday after the bell.
Here’s what analysts are expecting:
- Earnings per share (adjusted): $1.59 expected per Refinitiv
- Revenue: $13.63 billion expected per Refinitiv
The company previously reported deliveries of 241,300 electric vehicles and production of 237,823 vehicles during the period ending September 30, 2021.
Unlike other automakers, Tesla’s sales rose during the quarter, setting a new company record, despite chip shortages and supply chain challenges weighing on the industry. (Deliveries are the closest approximation of sales that Tesla reports.)
Last quarter, CEO Elon Musk said he would no longer lead earnings calls by default. He may choose not to address shareholders and analysts on Wednesday, which would surely disappoint his fans.
Investors submitted questions to Say Technologies, a site Tesla uses to poll shareholders ahead of earnings calls, seeking updates on the now-delayed Cybertruck, Tesla’s 4680 battery cells, and whether a $25,000 electric car, which Musk teased last year, is still underway.
Tesla’s strategy for weathering supply chain issues will also be in focus, along with the company’s ongoing investments in and sales of cryptocurrency and regulatory credits.
Ahead of the report, Bank of America raised its price objective for Tesla shares higher to $900 per share from $800.
BofA research analyst John Murphy, in a note to investors on Tuesday, laid out downside risks and upside potential for Tesla. Improving battery tech could be a boon for the company, he suggested, but if better battery cells don’t come about as soon as hoped, that could slow Tesla’s roll. Competition from incumbent automakers is also growing, he noted. Loss of management, a perpetual risk, could cause share prices to decline, too.
BofA raised its price target because Tesla has a “track record of growth, consistent capital raises, and overall investor hype.” Tesla could also potentially benefit from increases in federal or state incentives, rising gasoline prices, better execution and cost containment, and benefit from short sellers covering their positions.
Loup Ventures’ Gene Munster, who is also bullish Tesla, told CNBC ahead of the Q3 report that while competition in battery electric vehicles is building, he believes Tesla will still gain market share in the broader car market.
“It’s a simple equation to stay ahead of all of the upcoming competition, sell at scale the best value EV. That is a combination of design, range, advanced driving features and buying experience,” he said.
According to the latest numbers from Alix Partners, electric vehicles including fully battery electric cars like Tesla’s are on a path to comprise 28% of all new light commercial and passenger car sales worldwide by 2030.
The Biden administration is targeting a 50% overall reduction in greenhouse gas emissions by the US by 2030.
According to a 2021 study by Common Energy Labs, the transportation sector is the single largest driver of greenhouse gas emissions in the US today, representing about 28% of total emissions. The majority of transportation emissions derive from passenger vehicles, light- and medium-duty trucks. No significant reduction in greenhouse gas emissions can be achieved in the US without both electrifying these vehicles, and moving the power sector off of fossil fuels.
This is a developing story. Check back for updates.
— CNBC’s Michael Wayland contributed reporting.