Is Tesla making a profit?
This is probably one of the most asked questions about Tesla.
Investors considering buying Tesla’s stocks may want to see profitability before jumping on the bandwagon.
The reason is that a profitable company could pay out a dividend and buy back shares which is less risky.
It’s no exception for Tesla (NASDAQ:TSLA).
That said, in this article, we will explore Tesla’s profitability from the perspective of several measures.
Tesla achieved a gross profit of $20,000 as of 2Q 2023 on a TTM basis, roughly 11% higher than the figure reported in the same quarter a year ago.
Tesla’s growth in gross profit has been phenomenal since fiscal 2020.
Tesla achieved a similar success in operating profit.
As shown in the chart above, Tesla’s operating profit grew at an even higher growth rate, notably at 20% year-on-year to $12.7 billion as of 2Q 2023 on a TTM basis.
Tesla’s pre-tax profit surged to $13.4 billion as of 2Q 2023 on a TTM basis, one of the new highs since fiscal 2022.
Year-over-year, Tesla’s 2Q 2023 result represents a growth rate of 26%.
Tesla produces impressive net profit.
Accordingly, Tesla’s net profit swelled to as much as $12.2 billion as of 2Q 2023 on a TTM basis, up by a massive 28% from the same quarter a year ago.
As a non-GAAP measure, the adjusted EBITDA tells an even more compelling result.
As seen in the chart above, Tesla achieved an adjusted EBITDA of nearly the same level as its gross profit as of the latest quarter, illustrating an impressive cash-earnings capability of the company.
Earnings Per Share
Tesla’s earnings per share or EPS reached an important milestone of $3.53 as of 2Q 2023 on a TTM basis, a record figure in the last few years.
An even more incredible success is the fact that Tesla has flipped from an unprofitable company to a highly profitable one since fiscal 2020.
Profit Per Car
Tesla’s profit per car is illustrated by the gross profit per car presented in the chart above.
That said, Tesla’s profit per car has significantly declined in recent quarters after topping nearly $15,000 in 2022.
As of 2Q 2023, Tesla attained a profit per car of roughly $10,500 on average on a TTM basis.
Despite the decline, Tesla’s profit per vehicle is still pretty impressive by all measures.
An even more impressive achievement is the consistent profit per car numbers since fiscal 2019.
As seen, Tesla’s profit per car has never been lower than $10,000 for all periods shown in the plot.
Profit Per Employee
Tesla’s profit per employee is illustrated by several measures, namely operating profit per employee, pre-tax profit per employee, and net profit per employee.
For your information, Tesla employed approximately 128,000 full-time staff globally as of the end of fiscal 2022.
In fiscal 2022, Tesla’s profit per employee reached more than $100,000, nearly double the number measured in fiscal 2021.
In short, each employee generates roughly $100,000 of profit for Tesla on average.
An interesting fact is that Tesla has only started to become profitable since fiscal 2020.
Tesla is not only a profitable company but a highly profitable one.
References and Credits
1. All financial figures presented in this article were obtained and referenced from the company’s SEC filings, earnings releases, investors presentations, update letters, quarterly and annual reports, etc., which are available in Tesla Annual and Quarterly Results.
References and examples such as tables, charts, and diagrams are constantly reviewed to avoid errors, but we cannot warrant the full correctness of all content.
The content in this article is for informational purposes only and is neither a recommendation nor a piece of financial advice to purchase a stock.
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