My key takeaways:
1) Q4 2023 was below expectations, but not to such an extent as after the results for Q3 2023. Tesla sold more cars in Q4 2023 than the market expected (485k vs 473k), which it announced at the beginning of January. Still, revenues were lower than market expectations ($25.17 billion vs expected $25.87 billion, Figure 1) due to lower average selling prices. Tesla is constantly lowering the sales prices of its models, which is a way to increase sales while the demand for cars is weakening.
2) Therefore, due to the cuts in selling prices, margins were supposed to be the most important point for Wall Street. And here Tesla delivered more than the market expected, but not on every margin. The gross margin was below market expectations (17.6% vs. expected 18.1%), but perhaps the most important margin, automotive gross margin excluding regulatory credits, turned out to be well above expectations (17.2% vs. expected 15.0%, Figure 2). Mainly because that Tesla was able to reduce the cost of production per vehicle, Figure 3.
3) But it was the outlook for 2024 that did the most damage: "In 2024, our vehicle volume growth rate may be notably lower than the growth rate achieved in 2023, as our teams work on the launch of the next-generation vehicle at Gigafactory Texas." This means that in 2024, the growth will be weak, but it will be compensated by a stronger sales in 2025 (in H2 2025, a new car model from the lower segment will be launched with a target sales volume of up to 500,000 per year).
4) Therefore, in 2024, there remains the sale of existing models and the Cybertruck (which is unlikely to achieve large production volumes soon).
Yesterday the share price in the cash market reacted even stronger than in the after-hours trade (down 12.13% vs 6-8% in the after-hours trade) and it is similar to the previous 3 quarters:
After the results for Q1 2023, Tesla's price fell on the 1st day on the cash market by 9.75% (S&P500 -0.60%),
After the results for Q2 2023, Tesla's price fell by 9.74% on the 1st day (S&P500 -0.68%),
After the results for Q3 2023, Tesla's price fell by 9.30% on the 1st day (S&P500 -0.85%).
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