Tesla’s record profit: ‘There’s a lot more to come in 2022,’ analyst says

Tesla (TSLA) exceeded analyst expectations when it reported earnings Monday afternoon, with profits of $1.1 billion and a record number of deliveries for the quarter. But an analyst told Yahoo Finance that the electric car company has even more room to grow next year.

Deutsche Bank Lead Tech and Auto Technology Analyst Emmanuel Rosner noted that Tesla worked relentlessly to lower the cost of its vehicles and offer advanced battery technology.

“We really think this is about their low cost. This is about the superiority in battery technology, and it looks like there’s a lot more to come in 2022,” Rosner told Yahoo Finance Live on Tuesday.

Tesla’s adjusted earnings per share, $1.45, more than tripled in the second quarter from the same quarter last year, easily beating analyst expectations of $0.97. Total revenue was $11.96 billion and also exceeded expectations of $11.3 billion.

Tesla has had production problems of late, partly because of the global shortage of semiconductor chips and chip problems with battery production. However, the recent focus on improving production capacity could help increase the company’s production in the long run, Rosner said.

SpaceX founder and Tesla CEO Elon Musk watches as he visits the construction site of Tesla’s gigafactory in Gruenheide, near Berlin, Germany, May 17, 2021. REUTERS/Michele Tantussia

“Tesla did a spectacular job in the second quarter in a very, very challenging supply chain environment to actually produce as much as possible, almost maximizing capacity utilization,” Rosner said. “This has probably been one of the toughest quarters of a supply chain [perspective], special [with regard to] semiconductors.”

Rosner also noted that during the earnings call on Monday, CEO Elon Musk said Tesla “definitely plans to potentially double its [production] volume in 2022”.

Curiously, Musk announced that he might… skip revenue calls in the future, which raised questions about the future of his involvement with the company.

Rosner noted that while there was a clear possibility that Musk might at some point relinquish his position as CEO of Telsa in exchange for an executive chairman position like fellow billionaire and former Amazon CEO Jeff Bezos, the involvement of Musk at the company “has never been bigger”. ”

“He portrayed this decision to no longer be on the earnings call more as an efficient use of time,” Rosner said. “I don’t think this is something imminent… In the long run, yes absolutely, the fact that Tesla could do well without its day-to-day involvement would actually be very positive for this time.”

Ihsaan Fanusie is a writer at Yahoo Finance. Follow him on Twitter @IFanusie.

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