EV-market leader Tesla reports third-quarter results on Oct. 19.
Since early October Tesla (TSLA) – Get Tesla Inc. Report has all but disappeared from the radar of its charismatic and sometimes whimsical CEO and co-founder, Elon Musk.
Apart from a comment on Twitter to explain that the company had decided not to accelerate the pace of deliveries at the end of each quarter, Musk said little about the electric-vehicle-market leader, which is the bedrock of his immense fortune.
He gave a scathing response to an investor who asked him how investors should view Tesla moving forward, in light of the recent updates about Optimus, the humanoid robot the EV maker is building.
“I don’t care about boosting the stock,” the billionaire responded. “But the economic implications are obvious.”
Backdrop to the Last Earnings Call of 2022
Since third-quarter vehicle-delivery figures were reported on Oct. 3, Tesla stock has fallen 17%, an almost $144 billion drop in overall market value.
Some worry about these ominous figures. Not Musk, who has spent the past 15 days trying to find a peaceful solution to the Russia-Ukraine war, sometimes at the risk of tarnishing his image.
In an effort to settle the conflict, which started Feb. 24 with Russia invading Ukraine, the billionaire had proposed a plan that mirrored Russian demands. Musk notably suggested that Ukraine forgo Crimea, which Russia annexed in 2014, and renounce its plan to join NATO and the European Union.
The tech mogul also sparked another controversy by threatening to cut off Starlink in Ukraine, the secure satellite internet service offered by his aerospace company SpaceX, because of the exorbitant cost.
Starlink is the only communication system fpr the Ukrainian armed forces on the front. After an outcry, Musk backtracked and promised that SpaceX would continue to offer Starlink to Ukraine for free.
In addition to these diplomatic and geopolitical maneuvers, Musk is also finalizing the $44 billion acquisition of Twitter (TWTR) – Get Twitter Inc. Report. Some experts say he will have to sell additional Tesla shares to close the deal.
Musk has remained silent on this issue, no doubt for regulatory reasons, because the transaction was revived during the quiet period. That’s the time when there must be no formal or informal discussions between management of a public company and investors or analysts.
In view of this ultradense activity, Tesla appeared not to have been his priority in the past few weeks. But perhaps not:
The serial entrepreneur has just indicated that he will be present in person on the third-quarter-earnings call, scheduled for 5:30 p.m. U.S. Eastern on Oct. 19.
Musk will answer questions from the financial community, as well from Tesla shareholders, about the health of the company and its roadmap as a recession looms.
“Elon, will you be on the call this Wednesday?@elonmusk,” a Twitter user asked him on Oct. 17.
“Yes,” Musk responded.
Is a Stock Buyback in the Offing?
The earnings’ call will most likely be the last meeting between Musk and the financial community about Tesla in 2022. He announced an event on Oct. 31, but this one is about his artificial intelligence company Neuralink.
“After a Cinderella story for Tesla since late 2018 it’s been a painful period … for the company/investors,” Wedbush analyst Dan Ives said on Twitter.
“It starts with tomorrow [Oct.19] Musk laying out the EV vision for 4Q and into 2023 with some healthy financial direction for the Street. Needs to set hittable targets-key.”
During his recent interactions with Twitter users, Musk seemed not to rule out the prospect that Tesla might buy back shares in order to boost the stock price to reflect what the company believes to be its true value.
“Tesla is having PE ratio compression that can be solved only by buyback and/or by 2x earnings increase,” a Twitter user suggested on Oct. 3.
“Noted,” Musk responded.
Tesla is on track to meet or exceed its goal of delivering nearly 1.5 million vehicles in 2022. The company delivered 343,830 vehicles during the third quarter.
In total, the firm delivered 908,573 units over the first nine months of 2022, compared with 936,172 vehicles in full-year 2021. The company had experienced production disruptions at its Shanghai factory due to China’s zero-covid-19 policy and a factory refresh.
But the firm also opened two new factories in 2022 — in Berlin and Austin.
Possible News About New Tesla Factories
On Oct. 19 Tesla might also announce new features of full self-driving, or FSD, its advanced driver-assistance system.
“(Actually) Smart Summon is almost done,” Musk posted on Twitter on Oct. 18.
Summon is an autonomous parking feature that enables a Tesla car to leave a parking lot on its own at point A and pick up its owner at point B.
As a sign that Tesla seems to be weathering the current downturn pretty well, the company has started production of its electric semi truck, with first deliveries to PepsiCo (PEP) – Get PepsiCo Inc. Report scheduled for Dec. 1.
It is also possible that during the earnings’ call Musk unveils the locations where Tesla will build its next factories.
“2022 is the year we will be looking at factory locations to see what makes the most sense, with possibly some announcement by the end of this year,” Musk said during the company’s 2021 fourth-quarter-earnings call last January.
In addition, the techno king may provide new information on the long-awaited Cybertruck, the production and first deliveries of which are expected in mid-2023.