How to view Tesla's performance in January 2025? Pay attention to these four key points.

It's earnings season for US stocks again. The performance of giant companies not only affects their own stock prices but also influences the overall trend of the US stock market, which may present trading opportunities.

So, how should we view the performance of these giant companies? Today, we focus on Tesla, examining the key factors of Tesla's performance and the potential significant impact on stock prices.

1. Changes in Sales Volume

First of all, for new energy vehicle companies, the most important indicator to observe is always the total delivery volume, or sales volume. This is especially true for industry leaders like Tesla. Why?

Firstly, the higher the sales volume, the larger the market share, and the greater brand visibility among consumers.

Secondly, sales volume growth is directly reflected in revenue. Tesla's historical rapid revenue growth has been mainly driven by new car sales.

Thirdly, higher sales volume leads to stronger economies of scale and higher profit margins. This was more evident in Tesla's early development stages, and currently, Tesla's sales volume has reached a higher level, with a relatively limited impact on profit margins.

Because the sales volume indicator is so important, Tesla's stock price trend is closely related to its sales volume.

Generally speaking, New energy car companies will announce their sales volume every month, so Tesla's sales situation is usually disclosed ahead of earnings. On the Futubull app Tesla page's financial module, we can see the quarterly trend of Tesla's car sales.

For example, in the first quarter of 2022, Tesla's sales growth almost stopped, and by the second quarter of 2022, there was a first-time decline. Tesla's stock price also began to plummet in Q1 2022. In contrast, in the second quarter of 2023, Tesla's sales continued to exceed expectations, igniting Tesla's stock price.

So why has Tesla's sales been so tumultuous? It is largely related to Tesla's pricing strategy.

Before the fourth quarter of 2021, Tesla's prices for various models overall declined, coupled with the explosive demand for electric vehicles, sales also surged.

Starting from the fourth quarter of 2021, due to reasons such as the rise in battery prices, Tesla began to continuously increase prices. Revenue per vehicle increased from $0.0507 million to $0.0557 million, and Tesla's sales were consequently pressured, eventually turning into a decline.

By the third quarter of 2022, Tesla reopened price cuts, exchanging price for volume, with a continuous decline in single car revenue, but sales also saw an unexpected increase, and Tesla's stock price rose from a low of $100 to over $280 at one point.

However, in the first quarter of 2024, Tesla's sales once again returned to the path of decline, with quarterly sales falling below 0.4 million units, hitting a new low since Q4 2022, and the stock price also plummeted significantly.

Fortunately, in Q2 and Q3 of 2024, Tesla introduced an interest-free incentive policy, and sales rebounded continuously, reaching 0.4629 million units in Q3 2024, and its stock price also bottomed out and rebounded. In Q4, under global discount, interest-free, and other promotional policies, sales continued to rise, reaching 0.4956 million units, and the stock price continued to climb.

But looking at the full year of 2024, Tesla delivered a total of approximately 1.789 million vehicles, a decrease of 1.1% compared to 2023, marking the first annual decline in delivery volume since 2015. This news immediately led to a sharp drop in stock prices, falling by 6.08% as of the close on January 2nd.

特斯拉全年銷量之所以下滑，除了定價策略的影響，還因為它面臨著多方面的挑戰。

一方面市場競爭日益激烈，不管是比亞迪、蔚來、理想等中國品牌，還是通用汽車等美國本土品牌，都對特斯拉形成了一定的挑戰。

另一方面，特斯拉自身也有些問題，例如主力車型老化、新車型推出緩慢、自動駕駛進展不及預期、生產中斷和庫存積壓問題等。

此外還有政策不確定性方面的影響，而馬斯克參與政治活動也是一大變動因素。所以，未來如何表現還得再觀察。

2、盈利能力變化

對新能源車企來說，沒有銷量就沒有營收，但企業最終追求的還是利潤，如果盈利能力不行，光增收不增利，那投資者也會用腳投票。

例如，在造車新勢力中上市最早的三劍客蔚來、理想和小鵬汽車，理想率先實現盈利，而蔚來和小鵬的盈利能力卻遲遲不見好轉，正因為如此，理想的歷史股價表現雖然也出現大起大落，但仍遠遠強於蔚來和小鵬。

So how is Tesla's profitability? It is closely related to its sales volume and price trends.

Previously, when Tesla's sales volume rapidly increased, the company's gross margin and net income ratio also rose rapidly.

For example, from Q1 2019 to Q1 2022, Tesla's sales volume increased from 0.063 million vehicles to 0.31 million vehicles (about 5 times the previous value), with the gross margin increasing from 12.5% to nearly 30%, and net income also increased from -14.7% to 17.5%.

During this period, although Tesla's overall selling price declined, the decrease in battery costs, coupled with improved profitability brought by economies of scale, played a dominant role. Now, as Tesla's sales volume reaches a certain scale, Tesla's profitability will depend more on changes in selling price and costs.

In 2023, with Tesla's continuous significant price reductions, its profitability began to decline significantly. The gross margin decreased from over 25% in 2022 to 17.35% in Q1 2024. The net profit margin also decreased from over 15% to 5.37% in Q1 2024.

By Q2 and Q3 of 2024, Tesla's profitability rebounded slightly, with the gross margin increasing to 19.84% and net profit margin rebounding to 8.67%.

As for the upcoming Q4 financial report for 2024, Tesla's profitability data in the performance may still be our top concern. If profitability continues to rebound, it may be bullish for the stock price. If after a short-term rebound, it continues the previous downtrend, its stock price may come under pressure.

3. A comparison of actual performance with market expectations

After each Tesla earnings release, we need to pay close attention to the actual performance compared to the previous market expectations. For companies like Tesla that receive a lot of attention, analysts generally predict the company's performance before the earnings release. Data on analyst forecasts can also be easily found on the Futubull app.

For Tesla's performance, we mainly focus on the actual data of revenue and earnings per share (EPS) compared to analyst forecasts here.

In terms of revenue, since Tesla's various vehicle sales volumes have been released in advance, and Tesla's revenue mostly comes from car sales, analysts' forecasts for its revenue are usually quite accurate.

On the other hand, for another indicator, earnings per share (EPS), there may be more variability, which is also a point of great market concern. If the EPS exceeds expectations, the stock price may perform well in the short term, otherwise there may be short-term pressure.

For example, the actual EPS of Tesla's 2024 Q3 earnings was $0.62, significantly higher than analysts' expected $0.497. This created a bullish signal, and Tesla's stock price rose sharply in the short term, with the next day's increase exceeding 20% after the earnings announcement.

4. Expectations for new products

Currently, Tesla's market cap has reached nearly $1.3 trillion, maintaining its position as the world's highest market capitalization automaker. The PE ratio valuation has also exceeded 100 times. If we only consider the industry nature of manufacturing new energy vehicles, Tesla may find it difficult to sustain such a high valuation.

However, the reason why the market is willing to pay a high valuation for Tesla may largely lie in Tesla's prospects in AI development. Specifically, the focus is mainly on two potential new products.

The first product is Tesla's self-driving Robotaxi, which has been developed for many years, and the model is called CyberCab. Self-driving is undoubtedly a huge market (the market is expected to reach a scale of $4 trillion in the global Robotaxi market by 2030), providing ample room for Tesla's future growth (Tesla is expected to occupy a larger market share).

At the 'Robotaxi Day' conference, Musk stated that the CyberCab will start production in 2026, with mass production in 2027. The vehicle cost will be less than $0.03 million, and operating costs can be reduced to $0.2 per mile.

However, the overly distant production plan can be significantly below market expectations. Musk did not disclose specific technical details to highlight the company's competitive advantage. This may have sparked doubt among many investors about the competitiveness of this new product, leading to a sharp short-term decline in Tesla's stock price after the conference.

The second product is a humanoid robot named Optimus. Tesla has also been working on this project for several years and has accumulated leading global technological capabilities. Musk expects Optimus to be inexpensive, with costs below $0.02 million, and smart enough to replace some workers.

The market space for low-cost and practical humanoid robot products is also self-evident. However, this is just Tesla's vision for the market. The actual production time for Optimus keeps getting delayed, with the earliest production currently set for 2026.

In the future performance, we should focus on the latest developments in technology and production time for Tesla's Robotaxi and humanoid robots. The current market valuation assumes a high probability of success in this regard.

Next, if there are technological breakthroughs or the production time exceeds market expectations, perhaps it can continue to support Tesla's current high valuation. Conversely, if Tesla continues to struggle with large-scale implementation of these two major products, repeatedly disappointing the market, it may also put tremendous pressure on its valuation.

In conclusion, let's sum up:

Regarding the correlation between Tesla's performance and stock price:

We need to pay attention to the changes in monthly sales volume, which is the cornerstone of the company's competitiveness in the industry.

At the same time, we need to focus on whether Tesla's profitability can continue to improve in future performance. If it weakens, it may put pressure on its stock price.

Furthermore, we also need to pay attention to the comparison between Tesla's future performance and expectations. If it is lower than expected, it may create short-term pressure on the stock price, and if it continues to be below expectations, it will also impact long-term market confidence.

Finally, we need to closely monitor Tesla's technological breakthroughs and mass production timelines for self-driving rental cars and humanoid robots. This is a crucial support for Tesla's long-term valuation logic.

All these performance highlights cannot be viewed in isolation. They need to be analyzed comprehensively based on the market's focus at different times to understand their impact on stock prices.

Based on comprehensive analysis, if the latest performance releases bullish signals, consider taking long positions (buying stocks or long call options); if bearish signals are observed, consider short positions (shorting stocks or buying put options).

If the direction before the performance is unclear but the volatility is expected to be high, consider long volatility (e.g., buying straddle option combinations). If you want to profit from the pre-performance high implied volatility rapidly decreasing post-performance, consider shorting volatility (e.g., selling straddle option combinations).

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