{"id":30522,"date":"2023-07-02T16:21:19","date_gmt":"2023-07-02T20:21:19","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/tesla-second-quarter-deliveries-up-83-8-ahead-of-estimates\/"},"modified":"2023-07-02T16:21:21","modified_gmt":"2023-07-02T20:21:21","slug":"tesla-second-quarter-deliveries-up-83-8-ahead-of-estimates","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=30522","title":{"rendered":"Tesla Second Quarter Deliveries Up 83% \u2014 8% Ahead Of Estimates"},"content":{"rendered":"
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Tesla reported expectations-beating deliveries in its second quarter. The implications of this result for investors depend on how Tesla achieved those deliveries.<\/p>\n

If Tesla \u2014 3.5% of its shares are sold short, according to the Wall Street Journal<\/em> \u2014accomplished the result by cutting prices, revenues and profit margins could fall short of investors\u2019 expectations.<\/p>\n

If that happens, Tesla\u2019s stock price could fall \u2014 unless it raises its guidance for the third quarter.<\/p>\n

In the meantime, on July 2 an influential analyst said the expectations-beating delivery numbers would burn Tesla bears.<\/p>\n

Tesla\u2019s Expectation\u2019s Beating Second Quarter Shipments<\/h2>\n

Tesla delivered 83% more vehicles in the June-ending quarter than it did during the same period in 2022. According to CNBC<\/em>, in the latest quarter, the electric vehicle leader delivered 466,140 vehicles \u2014 8% more than Street Account<\/em> expected.<\/p>\n

Were the expectations-beating deliveries due to price cuts? Piper Sandler senior research analyst Alexander E. Potter wrote in a June 26 note Tesla prices were \u201cstable\u201d in the second quarter.<\/p>\n

Tesla did engage in some price cuts during the quarter. About 96% of Tesla\u2019s second quarter deliveries were of its Model Y crossover and Model 3 entry-level sedan \u2014 both of which \u201care now eligible for a $7,500 tax credit in the U.S. under the Inflation Reduction Act,\u201d according to CNBC<\/em>.<\/p>\n

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Moreover, the Journal<\/em> noted, as of late June, Tesla was \u201coffering thousands of dollars off certain vehicles it had in stock\u201d on top of those tax credits.<\/p>\n

Potter noted Tesla gave steep discounts in the first quarter \u2014 during which the average Tesla price fell 13% to $46,000 \u2014 and wrote third quarter price cuts would \u201creignite concerns\u201d about profit margins.<\/p>\n

CEO Elon Musk warned investors against selling Tesla stock short. As he tweeted before the announcement of second quarter deliveries, \u201cPlease advise people to be wary of margin loans. Tesla has always been a high variability stock, often with no obvious rhyme or reason. We are confident about long-term value creation, but cannot control the manic-depressive nature of the stock market.\u201d<\/p>\n

Will Tesla Fall Short Of Revenue And Margin Expectations?<\/h2>\n

Do these expectations-beating deliveries mean Tesla\u2019s operating margin will fall further? In the first quarter of 2023, Tesla\u2019s operating margin declined from 19.2% to 11.4% between the first quarter of 2022 and 2023, according to the Wall Street Journal<\/em>.<\/em><\/p>\n

Tesla has not provided clear guidance for revenue and operating margins in the second quarter. When Tesla reported its first quarter results April 19, Musk merely told investors he expected Tesla to produce between 1.8 million and 2 million vehicles in 2023, according to Investor\u2019s Business Daily<\/em>.<\/p>\n

In April, three analysts emphasized their concerns about Tesla\u2019s margin compression. According to IBD
\n IBD
\n <\/fbs-ticker>, these analysts included:<\/p>\n