10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-34756

Tesla, Inc.

(Exact name of registrant as specified in its charter)

Delaware

91-2197729

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

3500 Deer Creek Road

Palo Alto, California

94304

(Address of principal executive offices)

(Zip Code)

(650) 681-5000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock	TSLA	The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (“Exchange Act”) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:


Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 22, 2021, there were 990,015,158 shares of the registrant’s common stock outstanding.

TESLA, INC.

FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2021

INDEX


		Page
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)	4
	Consolidated Balance Sheets	4
	Consolidated Statements of Operations	5
	Consolidated Statements of Comprehensive Income	6
	Consolidated Statements of Redeemable Noncontrolling Interests and Equity	7
	Consolidated Statements of Cash Flows	9
	Notes to Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.	Controls and Procedures	43

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	44
Item 1A.	Risk Factors	45
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	58
Item 3.	Defaults Upon Senior Securities	58
Item 4.	Mine Safety Disclosures	58
Item 5.	Other Information	58
Item 6.	Exhibits	58

Signatures		60

Forward-Looking Statements

The discussions in this Quarterly Report on Form 10-Q contain forward-looking statements reflecting our current expectations that involve risks and uncertainties. These forward-looking statements include, but are not limited to, statements concerning any potential future impact of the coronavirus disease (“COVID-19”) pandemic on our business, supply chain constraints, our strategy, future operations, future financial position, future revenues, projected costs, profitability, expected cost reductions, capital adequacy, expectations regarding demand and acceptance for our technologies, growth opportunities and trends in the market in which we operate, prospects and plans and objectives of management. The words “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including, without limitation, the risks set forth in Part II, Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q and in our other filings with the Securities and Exchange Commission (the "SEC"). We do not assume any obligation to update any forward-looking statements.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Tesla, Inc.

Consolidated Balance Sheets

(in millions, except per share data)

(unaudited)


	June 30,			December 31,
	2021			2020
Assets
Current assets
Cash and cash equivalents	$	16,229		$	19,384
Accounts receivable, net		2,129			1,886
Inventory		4,733			4,101
Prepaid expenses and other current assets		1,602			1,346
Total current assets		24,693			26,717
Operating lease vehicles, net		3,748			3,091
Solar energy systems, net		5,883			5,979
Property, plant and equipment, net		15,665			12,747
Operating lease right-of-use assets		1,734			1,558
Digital assets, net		1,311			—
Intangible assets, net		283			313
Goodwill		203			207
Other non-current assets		1,626			1,536
Total assets	$	55,146		$	52,148
Liabilities
Current liabilities
Accounts payable	$	7,558		$	6,051
Accrued liabilities and other		4,778			3,855
Deferred revenue		1,693			1,458
Customer deposits		812			752
Current portion of debt and finance leases		1,530			2,132
Total current liabilities		16,371			14,248
Debt and finance leases, net of current portion		7,871			9,556
Deferred revenue, net of current portion		1,318			1,284
Other long-term liabilities		3,336			3,330
Total liabilities		28,896			28,418
Commitments and contingencies (Note 12)
Redeemable noncontrolling interests in subsidiaries		605			604
Convertible senior notes (Note 10)		—			51
Equity
Stockholders' equity
Preferred stock; $0.001 par value; 100 shares authorized; no shares issued and outstanding		—			—
Common stock; $0.001 par value; 2,000 shares authorized; 984 shares and 960 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively		1			1
Additional paid-in capital		28,205			27,260
Accumulated other comprehensive income		206			363
Accumulated deficit		(3,608	)		(5,399	)
Total stockholders' equity		24,804			22,225
Noncontrolling interests in subsidiaries		841			850
Total liabilities and equity	$	55,146		$	52,148

The accompanying notes are an integral part of these consolidated financial statements.

Tesla, Inc.

Consolidated Statements of Operations

(in millions, except per share data)

(unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Revenues
Automotive sales	$	9,874		$	4,911		$	18,579		$	9,804
Automotive leasing		332			268			629			507
Total automotive revenues		10,206			5,179			19,208			10,311
Energy generation and storage		801			370			1,295			663
Services and other		951			487			1,844			1,047
Total revenues		11,958			6,036			22,347			12,021
Cost of revenues
Automotive sales		7,119			3,714			13,576			7,413
Automotive leasing		188			148			348			270
Total automotive cost of revenues		7,307			3,862			13,924			7,683
Energy generation and storage		781			349			1,376			631
Services and other		986			558			1,948			1,206
Total cost of revenues		9,074			4,769			17,248			9,520
Gross profit		2,884			1,267			5,099			2,501
Operating expenses
Research and development		576			279			1,242			603
Selling, general and administrative		973			661			2,029			1,288
Restructuring and other		23			—			(78	)		—
Total operating expenses		1,572			940			3,193			1,891
Income from operations		1,312			327			1,906			610
Interest income		11			8			21			18
Interest expense		(75	)		(170	)		(174	)		(339	)
Other income (expense), net		45			(15	)		73			(69	)
Income before income taxes		1,293			150			1,826			220
Provision for income taxes		115			21			184			23
Net income		1,178			129			1,642			197
Net income attributable to noncontrolling interests and redeemable noncontrolling interests in subsidiaries		36			25			62			77
Net income attributable to common stockholders	$	1,142		$	104		$	1,580		$	120

Net income per share of common stock attributable to common stockholders (1)
Basic	$	1.18		$	0.11		$	1.64		$	0.13
Diluted	$	1.02		$	0.10		$	1.41		$	0.12
Weighted average shares used in computing net income per share of common stock (1)
Basic		971			928			966			921
Diluted		1,119			1,036			1,126			1,016

(1)

Prior period results have been adjusted to reflect the five-for-one stock split effected in the form of a stock dividend in August 2020.

The accompanying notes are an integral part of these consolidated financial statements.

Tesla, Inc.

Consolidated Statements of Comprehensive Income

(in millions)

(unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021			2020
Net income	$	1,178	$	129	$	1,642		$	197
Other comprehensive income (loss):
Foreign currency translation adjustment		63		73		(157	)		(4	)
Comprehensive income		1,241		202		1,485			193
Less: Comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interests in subsidiaries		36		25		62			77
Comprehensive income attributable to common stockholders	$	1,205	$	177	$	1,423		$	116

The accompanying notes are an integral part of these consolidated financial statements.

Tesla, Inc.

Consolidated Statements of Redeemable Noncontrolling Interests and Equity

(in millions, except per share data)

(unaudited)


													Accumulated
	Redeemable							Additional					Other			Total		Noncontrolling
	Noncontrolling			Common Stock				Paid-In		Accumulated			Comprehensive			Stockholders'		Interests in			Total
Three Months Ended June 30, 2020	Interests			Shares (1)		Amount (1)		Capital (1)		Deficit			(Loss) Income			Equity		Subsidiaries			Equity
Balance as of March 31, 2020	$	632			927	$	1	$	15,389	$	(6,104	)	$	(113	)	$	9,173	$	867		$	10,040
Reclassification between equity and mezzanine equity for convertible senior notes		—			—		—		16		—			—			16		—			16
Exercises of conversion feature of convertible senior notes		—			1		0		65		—			—			65		—			65
Issuance of common stock for equity incentive awards		—			4		0		57		—			—			57		—			57
Stock-based compensation		—			—		—		367		—			—			367		—			367
Distributions to noncontrolling interests		(13	)		—		—		—		—			—			—		(27	)		(27	)
Other		(2	)		—		—		—		—			—			—		—			—
Net (loss) income		(4	)		—		—		—		104			—			104		29			133
Other comprehensive income		—			—		—		—		—			73			73		—			73
Balance as of June 30, 2020	$	613			932	$	1	$	15,894	$	(6,000	)	$	(40	)	$	9,855	$	869		$	10,724


												Accumulated
	Redeemable						Additional					Other			Total			Noncontrolling
	Noncontrolling		Common Stock				Paid-In		Accumulated			Comprehensive			Stockholders'			Interests in		Total
Six Months Ended June 30, 2020	Interests		Shares (1)		Amount (1)		Capital (1)		Deficit			Loss			Equity			Subsidiaries		Equity
Balance as of December 31, 2019	$	643		905	$	1	$	12,736	$	(6,083	)	$	(36	)	$	6,618		$	849	$	7,467
Adjustments for prior periods from adopting ASU 2016-13		—		—		—		—		(37	)		—			(37	)		—