Tesla Records 2nd Profitable Year, Still Holding 42,000 BTC
Tesla recently released its 4th quarter earnings for 2021. The report revealed that the company performed better than initially anticipated despite the supply chain crises that plagued production.
The report also showed that Tesla’s Bitcoin holdings remained unchanged from Q3 2021. The company, which recently announced that it would start receiving payments in Doge for specific merchandise, had $1.26 billion worth of BTC (42,000 bitcoins).
The company did not buy or sell any digital currency, nor did it record any impairments to the worth of its holdings through the quarter which saw BTC hit an all-time high of $67,549.14, further proving its resolve to hold Bitcoin for the long-term.
Tesla’s Revenue And Earnings
The company posted revenue of $17.719 billion, up 65% year over year and exceeding the $16.64 billion projected by analysts. Net income increased by 760% to $2.32 billion, while adjusted profits per share came in at $2.54, exceeding the $2.37 prediction.
Automotive revenue increased by 71% to $15.97 billion, although energy generation and storage revenue decreased by 8% to $688 million. It was the division’s lowest revenue since the first quarter of 2021 and fell short of the StreetAccount average of $815.1 million.
In total, Tesla earned $5.5 billion in annual profit on $53.8 billion in sales last year. This is an increase from $721 million in profit and $31.5 billion from sales in 2020. Overall, 2021 has been considered a breakthrough year for the car-making giants, who have recorded successive profitable years.
Despite the impressive figures, the company believes that it may suffer from further supply chain challenges in 2022. The continued crisis combined with disruptions to labor and transportation is expected to affect Tesla’s ability to meet its increasing demand. As per the report:
“Our own factories have been running below capacity for several quarters as supply chain became the main limiting factor, which is likely to continue through 2022.”
Tesla delivered a record 308,000 cars in Q4 2021. However, the company believes opening its new Giga factories in Austin and Berlin will alleviate some demand pressure.
Following the report’s release, Tesla shares plunged by over 6% before recovering and closing at $918.40 per share at market close. On a broader scale, the year-to-date chart reveals that the stock price is down by 23.45% from its peak. However, the sell-off can also be attributed to the general fall in tech stocks and equities.
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Tesla’s Bitcoin Holding Remain Unchanged
The report shows that Tesla’s Bitcoin holdings were worth $1.26 billion by the end of Q4 2021. The company did not buy or sell any Bitcoin in the period, while their stock maintained the same value reported in Q3 2021.
Tesla announced in February 2021 that it was acquiring $1.5 billion worth of Bitcoin. In April, it sold 10% of its stake. Since then, it has continued to retain BTC on its balance sheet, including it in its quarterly earnings report.
Companies with Bitcoin on their balance sheets are required by the Securities and Exchange Commission (SEC) to use GAAP when filling their earnings report. Microstrategy recently ran afoul of this rule and drew the ire of the regulatory body.
Tesla seems to have followed the GAAP rule in filing its reports. The Generally Accepted Accounting Principle denotes that a corporation records an impairment loss if the price of an asset falls during a quarter. However, if the price rises, it is not recorded on the balance sheet as profit.
The automaker recorded an impairment of $51 million in its Q2 earnings. Since then, it has retained the same value on its BTC stack in both Q3 and Q4 2021.
Despite supply chain challenges, do you think Tesla will have another profitable year in 2022? Let us know in the comments below.