Investor's Corner
Tesla (TSLA) Q1 2023 earnings results: $23.3B in revenue, 19.3% non-GAAP gross margins
Tesla (NASDAQ:TSLA) posted its Q1 2023 earnings report after markets closed today. The results, which were discussed in the Q1 2023 Update Letter, were released after the closing bell on Wednesday, April 19, 2023.
Tesla’s earnings come on the heels of the company’s aggressive pricing strategy and record delivery numbers. In the first quarter, Tesla produced 440,808 vehicles and delivered 422,875. That’s a new record for the EV maker, which is quite impressive considering that Q1 is relatively short and it gets hit by holidays like the Chinese New Year.
The following is a quick overview of Tesla’s Q1 2023 results.
Earnings per Share
Tesla’s earnings per share for the first quarter of 2023 was listed at $0.85, which was right in line with analyst expectations of $0.85 as per estimates compiled by Refinitiv.
Revenue
Tesla posted revenues of $23.33 billion, which was a slight beat of the $23.21 billion that was expected by analysts compiled by Refinitiv. Automotive revenue, a core segment of Tesla’s business, was listed at $19.96 billion in Q1 2023.
Overall, revenue grew 24% YoY in Q1 to $23.3 billion year-over-year. This was impacted by a growth in vehicle deliveries, reduced ASP year-over-year, and negative FX impact of $0.88 billion.
Gross Margin
Tesla’s gross margin for the first quarter of 2023 was listed at 19.3%. In Q1 2022, Tesla’s gross margin was listed at 29.1%.
Profitability
Tesla’s operating income decreased YoY to $2.7 billion in Q1, resulting in a 11.4% operating margin. The company noted that operating income was affected by growth in vehicle deliveries, reduced ASP YoY, higher raw material, commodity, logistics and warranty costs, cost of production ramp of 4680 cells, and lower credit revenue, among others.
Net Income and GAAP Earnings
Net income, however, came at $2.51 billion, down about 24% from the past year. GAAP earnings were listed at $0.73, which is down about 23% from Q1 2022.
Cash
At the end of Q1 2023, Tesla’s cash, cash equivalents, and investments rose sequentially by $217 million, reaching a total of $22.4 billion. This was fueled in no small part by free cash flow of $441 million, though it was somewhat tempered by other financial activities such as debt repayments.
On Pricing and Affordability
A key focus of this quarter’s results would be Tesla’s pricing, which mostly got lower in Q1. In the recently released Update Letter, Tesla explained that while most of the automotive sector is still struggling with the economics of their respective EV programs, the company is looking to leverage its position as a cost leader. Tesla also highlighted that its pricing strategy considers a long-term view per vehicle.
“Our near-term pricing strategy considers a long-term view on per vehicle profitability given the potential lifetime value of a Tesla vehicle through autonomy, supercharging, connectivity, and service. We expect that our product pricing will continue to evolve, upwards or downwards, depending on a number of factors. Although we implemented price reductions on many vehicle models across regions in the first quarter, our operating margins reduced at a manageable rate. We expect ongoing cost reduction of our vehicles, including improved production efficiency at our newest factories and lower logistics costs, and remain focused on operating leverage as we scale.”
Vehicle Program Highlights
Tesla shared a number of updates on its vehicle programs in its Q1 2023 Update Letter. The company, for one, revealed that Cybertruck factory tooling is on track, and it is currently producing Alpha versions of the all-electric pickup truck.
Over the first quarter of 2023, the Tesla Model Y crossover also became the best-selling vehicle in Europe in Q1. The vehicle was also the best-selling vehicle in the United States during the quarter, at least outside pickup trucks.
Tesla’s Q1 2023 Update Letter can be found below.
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SpaceX (NASDAQ: SPCX) will report its second public earnings call today since its IPO earlier this year, and there are a few things we expect to hear about, as well as Wall Street analysts, who have already outlined their expectations for the call.
Wall Street analysts have a consensus of $12.72 billion in revenue and an earnings per share (EPS) of $0.13. These are broken down into three sectors: Space, Connectivity, and AI/SI, which are perceived in this way:
- Space: $1.41 billion
- Connectivity: $4.84 billion
- AI/SI: $6.47 billion
Other outlets cluster near $12.8 or $12.9 billion in revenue and $0.14 – $0.15 EPS. This implies a roughly 65 percent sequential growth from Q2’s $7.81 billion, driven mostly by AI/SI, with the first post-IPO positive EPS expected.
Here are the three things to watch for on the call:
AI Revenue Ramp and the $100B+ ARR target
AI is truly the swing factor for SpaceX, and analysts expect it to roughly double from Q2’s $2.56 billion and become about half of total revenue. Management previously guided to a $100 billion+ annualized run rate by December, including the Cursor acquisition, which was $60 billion, to close the quarter.
Listen for updates on SpaceX’s compute capacity, especially pertaining to its contracts with Google, Anthropic, and others, revenue per watt, any new deals, and Cursor’s early contribution.
Starlink/Connectivity Metrics and Mobile Expansion
Connectivity remains a main profit engine for SpaceX. Subscriber additions will be something to pay attention to, as Q2 ended at 12 million and previews are looking at 14 million for this quarter. Additionally, ARPU trends, enterprise and government growth, and any commentary on Starlink Mobile will be something to pay attention to, especially following the recent low-band spectrum deal and FCC-related constellation approvals.
Capex Trajectory, Cash Burn/FCF, and Starship/Operational Updates
Q2 capex of roughly $18.4 billion weighed on the stock. Investors will look to scrutinize Q3 spending levels, any guidance on the pace into Q4/2027, free cash flow, backlog, and liquidity. Operational color on Starship (Flight 14 milestones and Flight 15 timing/reusability progress), Falcon cadence, and government/NASA contracts are also in focus.
Of course, there will also be some speculation on the potential Tesla-SpaceX merger, but there was nothing mentioned in the company’s proxy it sent earlier this week.
SpaceX will report earnings after market close today and will stream the call on X.
Watch live as SpaceX discusses our Q3 2026 earnings at 3:30pm CT today → https://t.co/Qrb0qeVG15
— SpaceX (@SpaceX) October 20, 2026
Interested in ordering a Tesla? Use my referral code for three free months of Full Self-Driving (Supervised) here
Elon Musk said he is planning to give “every one of his SpaceX shares to every kid in America” in 2027, stating that “this will be the first of many.”
SpaceX went public earlier this year, and its stock price has been relatively stable since leveling off shortly after its IPO. Based on its current price, it’s a gift of just over $10 billion to children across the United States.
It appears to be closely related to President Donald Trump’s bank accounts for children, which were set up earlier this year as Trump Accounts.
Just hours earlier, Anthropic had announced the establishment of its Anthropic Public Benefit Fund, “a new wholly-owned entity dedicated entirely to public benefit.” Musk responded by stating he recommended “giving the shares directly to the public,” and that he would be doing it that way.
Just a little bit later, Musk said children across the U.S. would be getting a share from him:
Next year, I will give one of my SpaceX shares to every kid in America.
This will be the first of many.
— Elon Musk (@elonmusk) October 19, 2026
There are roughly 70 million children, meaning someone under the age of 18, in the United States, according to the Federal Interagency Forum on Child and Family Statistics. Musk’s ownership of SpaceX stock shows he has around 849 million Class A shares of SpaceX stock, according to filings with the SEC.
Investor's Corner
SpaceX’s biggest earnings test yet lands Tuesday, and Tesla shareholders should be watching
SpaceX reports earnings Tuesday as Wall Street watches AI spending, Starlink growth and Tesla merger
SpaceX reports third quarter results after the market closes Tuesday, with a webcast at 4:30 p.m. ET streamed on X, and Tesla follows a day later. Bloomberg consensus, cited by Pepperstone, calls for revenue of $12.89 billion, adjusted EBITDA of $6.62 billion and adjusted EPS near $0.15. That would be about 65% growth from the second quarter and SpaceX’s first profitable quarter since its IPO. Analysts expect roughly $6.4 billion from AI and $4.9 billion from Starlink, which is projected to reach 14.3 million consumer subscribers. Capital spending is forecast at $19.6 billion, leaving free cash flow near negative $11.6 billion.
The numbers matter because SpaceX has spent months trying to win over a skeptical market. It priced its record IPO at $135, spiked to $225.64, then sank near $105 in early August. Friday’s close of $146.03 sits about 28% below the June high. The Q2 report beat on revenue at $7.8 billion and put Starlink at 12 million subscribers, but $18.4 billion of capex hurt the stock. Since then SpaceX reached orbit on Starship Flight 14 with 26 Starlink V3 satellites, agreed to buy 800 MHz spectrum for about $8 billion as part of its Starlink Mobile push, and signed a fourth compute hosting deal in four months worth roughly $13 billion a year from December. Management is targeting more than 2 gigawatts of compute by year end and a $100 billion annualized revenue run rate. Evercore ISI, which raised its target to $275, said the quarter may be judged more on those targets than the reported figures
All of this sits under the Tesla merger question. Barclays analyst Dan Levy expects an all stock deal in which SpaceX buys Tesla at a premium, using reference values of $2.1 trillion and $1.5 trillion, and said an announcement would need to come by late October or early November to be voted on at Tesla’s December 6 annual meeting. Barclays estimates Musk would hold about 37% of the combined company and 56% of the votes. Musk said in July that combining companies cannot be discussed on an earnings call, but an investor question asking when SpaceX will merge with Tesla is sitting on SpaceX’s Q&A platform, and Teslarati has tracked how the Roadster demo revived the talk.
If a deal happens, Tuesday’s result would effectively set the price Tesla holders would receive. Their shares would convert into SpaceX stock, along with exposure to a company with a heavy investment on AI, while Tesla itself expects 2026 capex above $25 billion. A strong quarter and calmer spending would make that exchange easier to sell. Another round of heavy capex and a falling stock would make it harder.
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