Tesla (TSLA) releases Q4 2021 financial results: beat expectations with over $2 billion in profit

Fred Lambert | Jan 26 2022 - 1:07 pm PT

Tesla (TSLA) has released its financial results and shareholders letter for the fourth quarter of 2021, and consequently for its full-year 2021, after market close today.

We are updating this post with all the details from the financial results, shareholders’ letter, and the conference call later tonight. Refresh for the latest information.

Tesla Q4 2021 earnings expectations

Yesterday, we posted our Tesla Q4 2021 earnings preview with Wall Street expectations.

The Wall Street consensus for this quarter was $17.112 billion in revenue and earnings of $2.30 per share.

It represents both massive quarter-over-quarter and year-over-year increases in expectation – mainly due to the fact that Tesla confirmed record deliveries of over 300,000 vehicles during that quarter.

Tesla Q4 2021 earnings results

Now Tesla has posted the full results in its new shareholder’s letter and presentation (see below) and confirmed that it beat expectations on both revenue and earnings.

The company reported $17.7 billion in revenue and earnings of $2.54 per share (Non-GAAP).

Tesla generated over $2 billion in profits during the quarter for a total of over $5.5 billion in 2021 despite significant investments into future production:

“Additionally, we generated $5.5B of GAAP net income and $5.0B of free cash flow in 2021 – after spending $6.5B to build out new factories and on other capital expenditures.”

The company also achieved an impressive 30.6% gross margin on its vehicles in Q4, but it goes down to 29.2% when excluding regulatory credits – still way better than the rest of the industry.

Tesla’s cash position as also increased significantly this quarter:

“Quarter-end cash and cash equivalents increased sequentially by $1.5B to $17.6B in Q4, driven mainly by free cash flow of $2.8B, partially offset by net debt and finance lease repayments of $1.5B. Our total debt excluding vehicle and energy product financing has fallen to just $1.4B at the end of 2021.”

A very interesting disclosure is that Tesla incured a massive $340M payroll tax expense over CEO Elon Musk’s compensation plan in Q4. That was a big hit on their profitability.

We will be posting our follow-up posts here about the earnings and conference call to expand on the most important points (refresh the page to see the most recent posts):

Here’s Tesla’s Q4 2021 shareholder letter and presentation in full:

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Here’s Tesla’s Q4 2021 earnings conference call stream: