Tesla announced its Q2 2024 financial results on Tuesday, reporting a GAAP operating income of $1.6 billion, despite incurring $0.6 billion in restructuring charges. The company achieved a GAAP net income of $1.5 billion and a non-GAAP net income of $1.8 billion. “We achieved record quarterly revenues despite a difficult operating environment,” Tesla stated.
Financial Summary
Tesla’s total revenue for Q2 2024 increased by 2% year-over-year to $25.5 billion. This growth was primarily driven by increased revenue from the Energy Generation and Storage business, Cybertruck deliveries, and higher regulatory credit revenue. The company reported an operating cash flow of $3.6 billion and free cash flow of $1.3 billion, bringing total cash and investments to $30.7 billion.
Operational Summary
Tesla’s energy storage deployments reached a record 9.4 GWh in Q2, contributing significantly to the company’s overall revenue and gross profit. The Cybertruck became the best-selling EV pickup in the U.S. during this period. Tesla also reported progress in its AI initiatives, including price reductions for Full Self-Driving (FSD) in North America and free trials for hardware-equipped vehicles.
Vehicle Capacity and Technology
Tesla’s production capacity includes more than 550,000 units for Model 3 and Model Y in California, over 950,000 units for Model 3 and Model Y in Shanghai, and additional capacity for Model Y in Berlin and Texas.
The company continues to develop its next-generation vehicle platform and pursue advancements in autonomous driving and robotaxi services. The refreshed Model 3 ramp continued successfully, with more trims qualifying for the IRA Tax Credit.
Cybertruck production more than tripled sequentially, remaining on track for profitability by the end of 2024. The ongoing preparation of the Semi factory is on track for production to start by the end of 2025. Giga Berlin began producing right-hand drive vehicles and delivered its first units to the U.K.
AI and Hardware
Tesla rolled out a version of FSD Supervised that primarily relies on eye-tracking software to monitor driver attentiveness. Other key focus areas included continued reduction of interventions while improving driver comfort. FSD 12.5 has started rolling out in limited capacity to testers.
Tesla Optimus is performing its first task handling batteries in one of the factories. Also, the south extension of Giga Texas is nearing completion and will house Tesla’s largest cluster of H100s.
Vehicle and Other Software
Tesla’s vehicles continue to improve post-delivery via free OTA software updates. The Spring Release included an immersive full-screen vehicle controls view in Park, various UI improvements, a native Audible app, Hands-Free Trunk for vehicles with the necessary hardware, and more.
Battery, Powertrain, and Manufacturing
In Q2, Tesla produced 50% more 4680 cells compared to Q1 and continues to see cost improvements. The company started validation of vehicle testing for its first prototype Cybertruck with in-house dry cathode 4680 cells in July, marking a major cost reduction milestone once ramped. This is huge as it will lower the price of Cybertruck, while also increasing Tesla’s profits on the truck.
Energy
Tesla’s Megapack and Powerwall achieved record deployment in Q2 with 9.4 GWh of total storage deployments. Powerwall 3 is now available in the U.K., Canada, and Germany, in addition to the US. Don’t sleep on Tesla’s Energy business as it is one of the fastest growing segments right now.
Outlook
Looking forward, Tesla aims to continue reducing costs, growing its hardware business, and accelerating the development of AI-enabled products and services. The company expects growth in energy storage deployments and revenue to outpace its automotive business in 2024.
Key Metrics
Total revenue for Q2 2024 was $25.5 billion, a 2% increase year-over-year. Operating income decreased 33% year-over-year to $1.6 billion. GAAP net income was $1.5 billion, a 45% decrease year-over-year. Free cash flow increased 34% year-over-year to $1.3 billion. Energy storage deployments reached 9.4 GWh, a 158% increase year-over-year.
In after-hours trading, shares of Tesla are down 4.6%.
