Tesla Inc. (TSLA) has grown rapidly into one of the world’s largest all-electric vehicle companies through the sale of cars and pickup trucks in the U.S., China, and other countries throughout the world. The automotive segment accounts for the vast majority of revenue at the Palo Alto-headquartered company, and the U.S. accounts for nearly 44% of all sales.
Tesla faces growing competition from other major automakers who are developing and marketing electric vehicles, including General Motors Co. (GM), China-based Nio Inc. (NIO), as well as German-based automakers Volkswagen AG (VOW3) and Daimler AG (DAI).
Key Takeaways
- Tesla makes, sells, and services all-electric vehicles in the U.S., Europe, and China. It also sells energy generation products.
- The company gets the vast majority of its revenue and profit from automotive sales.
- Tesla is experiencing rapid growth in China.
- The company plans to move its headquarters to Austin, TX.
- Tesla produced 237,823 vehicles and delivered 241,300 in Q3 FY 2021.
Tesla Financials
Tesla announced in late July financial results for Q2 of its 2021 fiscal year (FY), the three-month period ended June 30, 2021. Net income rose 813.2% year over year (YOY) to $1.2 billion. Revenue expanded to $12.0 billion, up 98.1% compared to the year-ago quarter. About 43.5% of revenue was generated in the U.S., while China accounted for 23.9% of total revenue. Other countries across the globe accounted for the remaining 32.5%. Gross profit, which Tesla uses to measure profit in its individual business segments, increased 127.6% YOY to $2.9 billion.
In its earnings release for the quarter, Tesla highlighted the fact that it had surpassed $1.0 billion of GAAP net income for the first time ever. The electric vehicle maker also noted that the global semiconductor shortage and congestion at ports created a number of supply chain challenges amid record global demand for vehicles.
Tesla Business Segments
Tesla operates through two main business segments: Automotive and Energy Generation and Storage. The company provides revenue and gross profit metrics for each segment, as we show below and in the pie charts above.
Automotive
Tesla’s Automotive segment comprises the design, development, manufacturing, sales, as well as the leasing of electric vehicles and sale of automotive regulatory credits. The segment, which accounts for 93% of total revenue and nearly 99% of total gross profit, also includes non-warranty after-sales vehicle services, sales of used vehicles, retail merchandise, and vehicle insurance revenue. The segment posted a gross profit of $2.9 billion in Q2 FY 2021, up 129.9% compared to the year-ago quarter. Revenue rose 96.9% YOY to $11.2 billion.
Energy Generation and Storage
The Energy Generation and Storage segment, which accounts for 7% of total revenue and under 1% of total gross profit, includes the design, manufacture, installation, sales, and leasing of solar energy generation and energy storage products and related services. The segment posted a gross profit of $20 million in Q2 FY 2021, down 4.8% compared to the year-ago quarter. Revenue for the segment rose 116.5% YOY to $801 million.
Tesla Recent Developments
On Oct. 7, 2021, Tesla’s CEO Elon Musk said that the company is planning on moving its headquarters from Palo Alto, CA, to Austin, TX. The electric vehicle maker is currently in the process of building a large car and battery manufacturing complex in Texas.
On Oct. 2, 2021, Tesla released its vehicle production and delivery results for Q3 FY 2021. The company produced 237,823 vehicles during the quarter and delivered 241,300.
How Tesla Reports Diversity and Inclusiveness
As part of our effort to improve the awareness of the importance of diversity in companies, we offer investors a glimpse into the transparency of Tesla and its commitment to diversity, inclusiveness, and social responsibility. We examined the data Tesla releases to show you how it reports the diversity of its board and workforce to help readers make educated purchasing and investing decisions.
Below is a table of potential diversity measurements. It shows whether Tesla discloses its data about the diversity of its board of directors, C-Suite, general management, and employees overall, as is marked with a ✔. It also shows whether Tesla breaks down those reports to reveal the diversity of itself by race, gender, ability, veteran status, and LGBTQ+ identity.