One of the more notable factors in earnings results for a lot of companies closing out their quarters is gross margin. As the global economy continues to remain tumultuous, margins are indicative of how much companies are spending versus how much they are making, especially with inflation being a major factor in the current economy woes. Tesla’s Q3 2022 just dropped and its margins seem to be in a solid state, despite being down year-over-year from Q3 2021.
Tesla released its Q3 2022 earnings results on its investor relations website on October 19, 2022. The latest earnings results were illuminating regarding Tesla’s ongoing business through tough and uncertain times. Despite ongoing supply and delivery issues affecting its electric vehicles and battery manufacturing, Tesla still ramped up production and delivered a record number of cars on the quarter. For this, its gross margin came out to 27.9 percent on the quarter. This was down from Q3 2021’s 30.5 percent gross margin. However, it was pretty much equal over Q2 2022, which also had a 27.9 percent margin.
Tesla narrowly missed on revenue for Q3 2022, but came out ahead of expectation on earnings-per-share (EPS). It also came away with $21.1 billion USD cash on hand for the quarter, socking away an additional $2.2 billion throughout the quarter after expenses and offsets. The company’s margins may have stayed even from Q2 to Q3 2022, but it’s still above target for the company. Tesla has aimed to keep the margin above 20 percent and is doing so handily.
Even so, the company also saw headwinds that impacted its Q3 2022 results by around $250 million. Tesla still looks fairly strong for the end of its fiscal year, but stay tuned as we continue to report on further Tesla updates and other tech company earnings results throughout the coming weeks.