The decline is likely to continue, given the group’s mixed results in the third quarter and the cautious forecast for all of 2022.
“As we look to the future, our plans show that we are on track for 50% annual growth in production this year. Although we are tracking supply chain risks, which are out of our control,” Chief Financial Officer Zach Kirkhorn told analysts during the earnings call. “On the delivery side, we expect growth of just under 50%. % due to an increase in cars in transit at the end of the year.”
He added: “This means that once again you should expect a gap between production and deliveries in Q4. And those cars in transit will shortly be delivered to your customers upon arrival at their destination.”
Therefore, Tesla should produce almost 1.4 million vehicles in 2022 and deliver more than 1.4 million units. It would be a record in both cases, but the firm expected to deliver 1.5 million vehicles in 2022.
Tesla profits lower than those estimated by analysts
Tesla posted a third-quarter net profit of $3.3 billion on income from $21.45 billion , the company communicated on October 19. Despite a 56% increase, revenue was below the $21.96 billion forecast by analysts.
Faced with this avalanche of not very reassuring news, Musk took out the bazooka. In fact, the CEO indicated that Tesla had discussed a massive share buyback program, intended to remunerate shareholders by increasing the price of shares.
This share buyback program would be between $5 billion and $10 billion, the tech mogul told analysts during the earnings call.
“We discussed the buyback idea extensively at the board level,” Musk said. “The board generally thinks it makes sense to do a buyback. We want to work through the right process to do a buyback. But it’s certainly possible for us to do a buyback on the order of $5.” [mil millones] to $10 billion, even in next year’s downside scenario. Even if next year is a very tough year, we still have the ability to do a $5 buyback [mil millones] to $10 billion.”
He added that “it is obviously pending review and approval by the board.”
The tech mogul, however, seems optimistic that this will be done.
“So we are likely to do a significant buyback,” he concluded.
The announcement also comes a few months after Tesla went through a stock split. In recent days, investors have been speculating about a buyback on Twitter where Musk is very present.
“Tesla is having a PE ratio squeeze that can only be resolved by buyback and/or by a 2x earnings boost,” a Twitter user suggested on Oct. 3.
Source: Ambito
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