K id

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, 2023

OR

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

For the transition period from _________ to _________

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.)

1 Tesla Road Austin, Texas	78725
(Address of principal executive offices)	(Zip Code)

(512) 516-8177

(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 17, 2023, there were 3,173,994,467 shares of the registrant’s common stock outstanding.

TESLA, INC.

FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2023

INDEX

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements	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	24
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	32
Item 4.	Controls and Procedures	33
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults Upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	34
Signatures		36

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, competition, future operations and production capacity, 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 markets 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 I, Item 1A, “Risk Factors” of the Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and that are otherwise described or updated from time to time 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,
	2023			2022
Assets
Current assets
Cash and cash equivalents	$	15,296		$	16,253
Short-term investments		7,779			5,932
Accounts receivable, net		3,447			2,952
Inventory		14,356			12,839
Prepaid expenses and other current assets		2,997			2,941
Total current assets		43,875			40,917
Operating lease vehicles, net		5,935			5,035
Solar energy systems, net		5,365			5,489
Property, plant and equipment, net		26,389			23,548
Operating lease right-of-use assets		3,352			2,563
Digital assets, net		184			184
Intangible assets, net		202			215
Goodwill		263			194
Other non-current assets		5,026			4,193
Total assets	$	90,591		$	82,338
Liabilities
Current liabilities
Accounts payable	$	15,273		$	15,255
Accrued liabilities and other		7,658			7,142
Deferred revenue		2,176			1,747
Customer deposits		1,026			1,063
Current portion of debt and finance leases		1,459			1,502
Total current liabilities		27,592			26,709
Debt and finance leases, net of current portion		872			1,597
Deferred revenue, net of current portion		3,021			2,804
Other long-term liabilities		6,924			5,330
Total liabilities		38,409			36,440
Commitments and contingencies (Note 9)
Redeemable noncontrolling interests in subsidiaries		288			409
Equity
Stockholders’ equity
Preferred stock; $0.001 par value; 100 shares authorized;     no shares issued and outstanding		—			—
Common stock; $0.001 par value; 6,000 shares authorized;     3,174 and 3,164 shares issued and outstanding as of     June 30, 2023 and December 31, 2022, respectively		3			3
Additional paid-in capital		33,436			32,177
Accumulated other comprehensive (loss)		(410	)		(361	)
Retained earnings		18,101			12,885
Total stockholders’ equity		51,130			44,704
Noncontrolling interests in subsidiaries		764			785
Total liabilities and equity	$	90,591		$	82,338

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

4

Tesla, Inc.

Consolidated Statements of Operations

(in millions, except per share data)

(unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2023			2022			2023			2022
Revenues
Automotive sales	$	20,419		$	13,670		$	39,297		$	29,184
Automotive regulatory credits		282			344			803			1,023
Automotive leasing		567			588			1,131			1,256
Total automotive revenues		21,268			14,602			41,231			31,463
Energy generation and storage		1,509			866			3,038			1,482
Services and other		2,150			1,466			3,987			2,745
Total revenues		24,927			16,934			48,256			35,690
Cost of revenues
Automotive sales		16,841			10,153			32,263			21,067
Automotive leasing		338			368			671			776
Total automotive cost of revenues		17,179			10,521			32,934			21,843
Energy generation and storage		1,231			769			2,592			1,457
Services and other		1,984			1,410			3,686			2,696
Total cost of revenues		20,394			12,700			39,212			25,996
Gross profit		4,533			4,234			9,044			9,694
Operating expenses
Research and development		943			667			1,714			1,532
Selling, general and administrative		1,191			961			2,267			1,953
Restructuring and other		—			142			—			142
Total operating expenses		2,134			1,770			3,981			3,627
Income from operations		2,399			2,464			5,063			6,067
Interest income		238			26			451			54
Interest expense		(28	)		(44	)		(57	)		(105	)
Other income, net		328			28			280			84
Income before income taxes		2,937			2,474			5,737			6,100
Provision for income taxes		323			205			584			551
Net income		2,614			2,269			5,153			5,549
Net (loss) income attributable to noncontrolling    interests and redeemable noncontrolling interests    in subsidiaries		(89	)		10			(63	)		(28	)
Net income attributable to common stockholders	$	2,703		$	2,259		$	5,216		$	5,577
Net income per share of common stock    attributable to common stockholders (1)
Basic	$	0.85		$	0.73		$	1.65		$	1.79
Diluted	$	0.78		$	0.65		$	1.50		$	1.61
Weighted average shares used in computing net    income per share of common stock (1)
Basic		3,171			3,111			3,168			3,107
Diluted		3,478			3,464			3,473			3,469

(1)Prior period results have been adjusted to reflect the three-for-one stock split effected in the form of a stock dividend in August 2022.

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

5

Tesla, Inc.

Consolidated Statements of Comprehensive Income

(in millions)

(unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2023			2022			2023			2022
Net income	$	2,614		$	2,269		$	5,153		$	5,549
Other comprehensive income (loss):
Foreign currency translation adjustment		(184	)		(421	)		(54	)		(517	)
Unrealized net (loss) gain on investments		(5	)		(6	)		1			(14	)
Adjustment for net loss realized and included in net income		4			—			4			—
Comprehensive income		2,429			1,842			5,104			5,018
Less: Comprehensive (loss) income attributable to    noncontrolling interests and redeemable    noncontrolling interests in subsidiaries		(89	)		10			(63	)		(28	)
Comprehensive income attributable to    common stockholders	$	2,518		$	1,832		$	5,167		$	5,046

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

6

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		Comprehensive			Retained		Stockholders’		Interests in			Total
Three Months Ended June 30, 2023	Interests			Shares		Amount		Capital		(Loss)			Earnings		Equity		Subsidiaries			Equity
Balance as of March 31, 2023	$	407			3,169	$	3	$	32,878	$	(225	)	$	15,398	$	48,054	$	774		$	48,828
Exercises of conversion feature of    convertible senior notes		—			0		0		0		—			—		0		—			0
Issuance of common stock for equity    incentive awards		—			5		0		63		—			—		63		—			63
Stock-based compensation		—			—		—		495		—			—		495		—			495
Distributions to noncontrolling interests		(9	)		—		—		—		—			—		—		(28	)		(28	)
Buy-outs of noncontrolling interests		(3	)		—		—		—		—			—		—		—			—
Net income		(107	)		—		—		—		—			2,703		2,703		18			2,721
Other comprehensive income		—			—		—