Tesla (TSLA) Q1 2021 results: what to expect

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You’re here (NASDAQ: TSLA) will be holding its Q1 earnings call after Monday’s session, and expectations are pretty high. After a first-quarter blowout that saw the company completely decimate Wall Street’s expected vehicle deliveries, expectations are now high that the electric vehicle maker will post record numbers for its record quarter.

Here are Wall Street’s expectations for Tesla’s first quarter 2021 earnings, along with a number of crucial metrics TSLA investors should watch out for.

Preview

Wall Street currently expects Tesla to report non-GAAP earnings per share (EPS) of $ 0.79 in the first quarter. It’s quite impressive, and it represents a 216% year-over-year increase. Tesla’s EPS was at a relatively conservative $ 0.23 in Q1 2020. However, it was very impressive in the fourth quarter of 2020, when the company posted EPS of $ 0.80.

As for Tesla’s first quarter 2021 revenue, the consensus forecast for the quarter is currently $ 10.29 billion. This estimate is quite optimistic, as it represents a year-over-year increase of 72%. By comparison, Tesla’s fourth quarter 2020 revenue was $ 10.74 billion.

For the first quarter, Tesla delivered a total of 184,800 vehicles comprising 182,780 Model 3 and Model Y and 2,020 Model S and Model X. This corresponds to a 109% year-over-year increase and sequential growth of 2.2%. Overall vehicle production for the first quarter of 2021 was 180,338.

Key factors to watch out for

Given that the automotive gross margin slipped to 24.1% in the fourth quarter of 2020 from 27.7% in the previous quarter, it is likely that Tesla could see some moderation in margins in the first quarter. This is likely affected by the company’s discontinuation of production and deliveries of the flagship Model S and Model X models, both of which have received extensive updates.

Regulatory credits are also believed to play a role in Tesla’s first quarter 2021 numbers. In the fourth quarter of 2020, regulatory credits represented 4.2% of Tesla’s revenue. It would then be interesting to see if the electric vehicle maker has done more this time around, given that traditional automakers are still struggling to switch to sustainable transportation.

Tesla has yet to provide a specific vehicle delivery estimate for 2021. However, given the company’s strong first quarter results, it wouldn’t be surprising if Tesla ended up providing refined delivery forecasts for 2021. In 2020, Tesla’s vehicle deliveries increased 36% to 499,647, and this year Elon Musk and CFO Zach Kirkhorn noted that the company could see annual growth of 50% or more.

TSLA stock so far

Tesla stock has seen headwinds in recent times, likely due to negative coverage from China and a crash in Texas that appeared to be wrongly linked to autopilot. That being said, TSLA shares still closed on Friday up 1.35% at $ 729.40. Overall, as Tesla has fallen 40% from its all-time high of $ 900.40 in late January, the electric vehicle maker has since recouped more than 25% of its loss.

Tesla’s first quarter earnings conference call will take place on Monday, April 26, 2021 at 2:30 p.m. PT or 5:30 p.m. EST. Tesla’s Q1 2021 update letter would be released shortly after markets close on Monday.

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