Tesla hits record profit despite parts shortage, ship delays

PTI, Oct 21, 2021, 9:50 AM IST

Source: unsplash

Record electric vehicle sales last summer amid a shortage of computer chips and other materials propelled Tesla Inc. to the biggest quarterly net earnings in its history.

The company said Wednesday that it made $1.62 billion in the third quarter, beating the old record of $1.14 billion set in the second quarter of this year. The profit was over five times larger than the $300 million Tesla made in the same quarter a year ago.

Revenue of $13.76 billion from July through September also set a record, but it fell short of Wall Street expectations of just over $14 billion, according to FactSet.

Excluding special items such as stock-based compensation, Palo Alto, California-based Tesla made $1.86 per share, beating analyst estimates of $1.62. CEO Elon Musk has said he’s moving the headquarters to Austin, Texas, the dateline of Wednesday’s earnings release.

Some of the quarterly profit, though, came from selling regulatory credits to other automakers. Tesla made $279 million on credits during the quarter. Other automakers buy the credits when they can’t meet emissions and fuel-economy standards.

”A variety of challenges, including semiconductor shortages, congestion at ports and rolling blackouts, have been impacting our ability to keep factories running at full speed,” the company said in a statement to shareholders.

“We believe our supply chain, engineering and production teams have been dealing with these global challenges with ingenuity, agility and flexibility that is unparalleled in the automotive industry.” Earlier this month Tesla said it delivered a record 241,300 electric vehicles in the third quarter even as it wrestled with the shortages that have hit the entire auto industry.

Third-quarter sales rose 72% over the 140,000 deliveries Tesla made for the same period a year ago.

So far this year, Tesla has sold around 627,300 vehicles. That puts it on pace to soundly beat last year’s total of 499,550.