Tesla(US:TSLA) Goldman Sachs·2025-04-23 07:56Investment Rating - The report assigns a Neutral rating to Tesla Inc. with a 12-month price target of $260, indicating a potential upside of 9.3% from the current price of $237.97 [17][19]. Core Insights - The report presents a mixed view on Tesla's performance, highlighting weaker non-GAAP EPS of $0.27 compared to the Street's expectation of $0.41, alongside ongoing risks from tariffs and macroeconomic factors. However, some key metrics, such as new vehicle model production timing and automotive non-GAAP gross margin excluding credits, were better than feared [3][4]. - Tesla's revenue for 1Q25 was reported at $19.3 billion, which is 9% below the previous year and 3% below Goldman Sachs' estimate. Vehicle deliveries were approximately 337,000, down 32% quarter-over-quarter and 13% year-over-year [5][10]. - The automotive non-GAAP gross margin was reported at 12.5%, below Goldman Sachs' estimate of 13.0% but above the Street's consensus of 11.6%. This margin decreased from 13.6% in 4Q24 and 16.4% in 1Q24 [6][10]. - Tesla plans to start production of new lower-cost models in the first half of 2025 and aims to begin robotaxi operations by June in Austin, Texas [3][4][13]. Summary by Sections Financial Performance - Tesla reported 1Q25 revenue of $19,335 million, down 25% quarter-over-quarter and down 9% year-over-year, which was 3% below Goldman Sachs' estimate and 9% below the Street [5][10]. - The automotive revenue was $13,967 million, down 29% quarter-over-quarter and down 20% year-over-year, with an implied vehicle average selling price (ASP) of about $40,000 [8][10]. - Energy Generation and Storage revenue was $2,730 million, down 11% quarter-over-quarter but up 67% year-over-year, with energy being Tesla's highest margin business in 1Q [8][9]. Outlook and Guidance - Tesla indicated that the growth rate for the year will depend on various factors, including the acceleration of autonomy efforts and the production ramp at its factories. The company plans to revisit its 2025 guidance in the second quarter update [4][12]. - The company previously expected vehicle business growth in 2025, contrasting with Goldman Sachs' estimate of a 4% decline year-over-year and a consensus of a 2% increase for vehicle deliveries [4][12]. Key Metrics - The total company gross margin was reported at 16.3%, slightly below the Street's estimate of 16.4% but above Goldman Sachs' estimate of 15.6% [6][10]. - Free cash flow (FCF) for 1Q25 was $0.7 billion, with cash and cash equivalents increasing to $37.0 billion [11].