Tencent technology news on July 27, Tesla’s financial report for the second quarter of 2021 released on Monday showed that the company’s net profit for the quarter reached US $1.14 billion, far higher than US $104 million in the same period last year. This is also the first time that Tesla’s quarterly profit exceeded $1 billion.
Tesla’s overall electric vehicle revenue in the second quarter reached $10.21 billion, of which only $354 million came from the sale of carbon emission credits, accounting for about 3.5% of its overall revenue. This figure is lower than any of the previous four quarters. Meanwhile, Tesla’s gross profit margin of electric vehicle business in the second quarter was 28.4%, higher than any quarter in the past four quarters.
Tesla previously released data show that in the second quarter ended June 30, the company delivered 201250 electric vehicles and produced 206421. Tesla’s financial report also showed that the company’s energy business revenue, including solar photovoltaic and energy storage systems for households, enterprises and utilities, was $801 million, an increase of more than 60% over the previous quarter. Although Tesla did not disclose how many energy storage devices it sold each quarter, Elon Musk, the company’s chief executive, said in court a few weeks ago that the company could only produce 30000 to 35000 sets at most in this quarter, and attributed this capacity lag to the shortage of chips.
Tesla’s financial report also showed that the company’s service and other revenue in the second quarter was $951 million. At present, the company has 598 stores and service centers around the world, and also has an online car Hailing fleet with 1091 electric vehicles, an increase of 34% over a year ago. In contrast, vehicle delivery increased by 121% year-on-year.
The company’s cash position fell about 5% from the previous quarter to $16.23 billion. Tesla said in its financial report that the decline “was mainly driven by net debt and financial lease repayment of $1.6 billion, partially offset by free cash flow of $619 million.” Tesla’s accounts payable in the second quarter – that is, Tesla’s money owed to suppliers and other service providers – increased by 13.7% over the previous quarter to $7.56 billion.
Bitcoin investment loss
Tesla financial report showed that the company’s quarterly operating profit decreased by $23 million due to the loss of bitcoin investment. The impairment related to the value of bitcoin held by the company is classified as operating expenses under “restructuring and other”.
The electric vehicle company only mentioned bitcoin or cryptocurrency once in its announcement in the second quarter. Previously, CEO musk had been wavering on whether Tesla would accept this digital currency to buy cars. In Monday’s earnings conference call, this topic did not appear at all.
In February, Tesla announced that it would spend $1.5 billion on bitcoin – more than its R & D budget for the whole quarter – and said it might continue to invest in cryptocurrency. By the end of March, the company said that due to the surge of bitcoin in the first quarter, the market value of bitcoin held by it had reached $2.48 billion. Tesla made a profit of $101 million by selling some bitcoins in the first quarter, helping the company’s profits hit a new high in the quarter.
However, the price of bitcoin plunged by more than 40% in the second quarter, resulting in a sharp decline in the market value of bitcoin held by Tesla compared with the end of the first quarter. The value of bitcoin once soared to $63000 in April this year, and then fell below $30000 this month. At present, bitcoin is worth about $40000.
Tesla does not treat bitcoin as a mark to market asset, which means that it will recognize revenue only if it sells bitcoin to lock in revenue. Therefore, as long as Tesla does not reduce any shares, the decline in bitcoin value should not affect earnings. This is a different way of investment reporting from supporting technology start-ups through the venture capital department. In this case, the company usually prices its shares according to the market price every quarter, and determines the value through subsequent financing or public share price.
Although bitcoin investment reduced Tesla’s operating profit by $23 million in the second quarter, the company’s operating profit in the quarter still increased more than fourfold year-on-year to $1.3 billion, exceeding market expectations.
Semi truck delayed launch
In the second quarter, among other challenges, Tesla also faced fierce reactions from Chinese consumers, recalls in China and the United States, and delayed delivery of the high-performance version of its flagship car model s playd. Institutional and retail investors asked to know when the company plans to start the commercial production of its cybertruck and custom batteries, and how Tesla will respond to Musk’s previous complaints about the continuous shortage of parts and the rising cost of raw materials.
Lars moravy, vice president of Tesla electric vehicle engineering, said that cybertruck production will begin at Tesla’s new plant in Texas by the end of 2021. Musk stressed that this would be a limited production at first. He expected that it would be challenging to increase the production to high production due to the unique design of the car. Tesla said that the production of cybertruck will follow the production of model y in Texas.
For Tesla and other carmakers, the problem of parts shortage has always existed. At the shareholders’ meeting, Tesla said that it had postponed the semi truck launch plan to 2022. At the shareholders’ conference call on Monday, musk said that “a major problem in this quarter” was to purchase enough modules to control the airbags and seat belts of Tesla electric vehicles. The insufficient supply limited the company’s production in Fremont, California and Shanghai.
When asked when Tesla will open its fast charging station to other non Tesla electric vehicle drivers, musk and drew Baglino, senior vice president of powertrain and energy engineering, said that the company’s goal will be to fully expand its charging network, which will not prolong the waiting time for drivers to charge the vehicle on the road.
Musk also took some time to convince shareholders that he would “no longer default” and speak at the Tesla earnings conference call after this quarter, let alone take the lead. He did say that he would speak at the annual general meeting.
Chip shortage and production restriction
Musk also said that many fans are asking why Tesla does not directly produce its own chips to avoid shortage. He said that the supply chain problem is a problem Tesla will solve with suppliers, and joked that “it’s not like you can make a chip factory at will.” Musk said that since Tesla uses as many semiconductors and batteries in electric vehicles as in energy storage products, the company has reduced the production of Powerwall, and its Megapack battery system for power stations will be sold out by the end of next year. Musk said he believes that in view of the promotion of the transformation to renewable energy, the demand for “more than 1 million powerwalls per year” may be very large, and the demand for utilities may be very large, but the specific amount is unknown. “Solar and wind energy are intermittent. In essence, they do need battery packs to provide a stable power supply,” he explained.
As a strategy to manage the supply chain of automobiles and energy storage products, musk said that Tesla will “overshoot” the supply of electric vehicle batteries. Whenever there is an oversupply, it can turn the supply to manufacture Powerwall and Megapack.
Two angry apples
At Monday’s shareholders’ meeting, musk attacked Silicon Valley neighbor Apple twice. Although the two companies do not have direct competition today, it is reported that apple is building an electric autopilot under a project called “Titan”, and has attracted many engineers and executives away from Tesla. It is reported that Doug field is in charge of the Titan project. After working for Tesla for five years, he returned to apple in 2018.
When asked about Tesla’s supply chain, musk said that there was a misunderstanding that Tesla used a lot of cobalt. Cobalt is a key material for the production of lithium-ion batteries used in smart phones and electric vehicles. “I think Apple uses almost 100% cobalt in their batteries, mobile phones and laptops, but Tesla doesn’t use Cobalt in iron phosphate bags and almost doesn’t use Cobalt in nickel based chemicals,” Musk said. On a weighted average basis, we may use 2% cobalt instead of Apple’s 100% cobalt. In short, this is really not a factor. ”
Some cobalt mined in places such as the Democratic Republic of the Congo is related to human rights violations such as child labour. According to the guardian, in 2019, in addition to major technology companies such as Tesla, Apple was also listed as a defendant in human rights litigation. In a report released earlier this year, apple said that all cobalt suppliers had participated in the audit in 2020. Apple representatives did not respond to requests for comment.
In the subsequent conference call, musk attacked Apple’s so-called “walled garden”. It is named “walled garden” because Apple strictly controls which apps can be installed on the iPhone through its app store. Apple’s walled garden is facing scrutiny from lawmakers and other companies, including the antitrust trial earlier this year, when the company was sued by Epic Games for App Store fees and policies“ I think we really want to emphasize that our goal is to support the emergence of sustainable energy, “Musk said in response to a question about allowing competitors to use their charger network“ This is not to build a walled garden and use it to attack our competitors. This is the method used by some companies. ” Musk then pretended to cough and said, “apple.”
Musk also said that unless he has “very important things” to announce, he may no longer participate in the Tesla earnings conference call（ Tencent Technology (compiled / Mowgli)