Tesla Reports Mixed Q4 Results, Targets Growth Return in 2025
Tesla (TSLA) announced a commitment to revenue growth recovery in 2025 after its fourth-quarter results fell short of expectations. The company reported a modest 1% revenue increase in 2024, while profits declined sharply.
Unsupervised FSD Expansion and Austin Launch
During the earnings call, CEO Elon Musk revealed plans to introduce unsupervised FSD (Full Self-Driving) in Austin, Texas, in June. Analysts anticipate the expansion to boost growth prospects.
Financial Performance
Tesla reported fourth-quarter revenue of $25.7 billion, below analyst estimates of $27.2 billion. Adjusted earnings per share were $0.73, missing expectations of $0.75. Despite a 3% increase in adjusted net income to $2.6 billion, operating income declined by 23% due to higher costs and lower average vehicle pricing.
Outlook for 2025 and Beyond
Tesla anticipates a return to growth in its auto business in 2025. However, analysts have expressed concerns about the lack of specific guidance and the impact of increasing competition. The company plans to roll out FSD in Europe and China in 2025, along with new vehicle launches and production expansions.
Energy Storage and Capital Spending
Tesla's energy storage business remains a positive area, with projected 50% growth in deployments. The company plans to invest heavily in capital expenditures, estimated at over $11 billion this year and the next two fiscal years.
Model Y Shutdown and New Vehicle Production
Tesla will temporarily halt Model Y production to facilitate a model changeover, impacting margins. The company confirmed plans for new vehicle production, including "more affordable models," starting in early 2025. The Cybercab robotaxi remains on track for volume production in 2026.
Musk's Role in US Industrial Policy
Elon Musk emphasized the need to prioritize manufacturing in the US, expressing his support for policies that promote domestic production.