Tesla ended Q4 2022 with a net income of $3.7 billion and the full year with $12.6 billion in profits. Elon Musk's company more than doubled its earnings compared to the previous year, despite the slump in its share price and sales problems in the Chinese market. The road there was rocky in parts, as our chart shows.
In 2020, for example, the automaker managed to break even for the first time. This was partly a result of the increased demand for electric cars after the Model S and Model X, launched in 2012 and 2015, failed to generate significant revenue for Tesla. Taking a closer look at the 2020 results, it's clear that the company did not generate its profit from its core business. Although there was a net positive of $721 million at the end of the corresponding year, the sale of climate credits worth almost $1.6 billion was the main driver for its turn to profitability.
Although Tesla was again able to generate $1.5 billion in 2021 by selling carbon credits, an 87 percent increase in vehicles delivered, cost reductions per car manufactured and an excellent year on the stock market ultimately ensured a gross profit margin of just over 25 percent. The automaker maintained this margin in 2022 despite higher raw material prices, which was likely due in part to a 40 percent increase in vehicles delivered over last year's figures and a nearly $300 million increase in carbon credit sales to about $1.8 billion. The positive result caused the share price to rise by around $13 per share after close at 8:30 AM EST, an increase of about nine percent compared to its closing price on January 25.
Despite record results, Tesla partly suffered, especially on the stock market, due to the acquisition of Twitter by its CEO Elon Musk. Waves of layoffs, a restructuring of core functions of the social network, and accusations from some prominent investors that Musk was setting his priorities wrong caused the stock price to plunge from $309 per share in August 2022 to as low as $108 in early 2023. Recent revelations that a 2016 video showing a Tesla vehicle engaged in autonomous driving was staged didn't significantly affect the stock price.
Musk is also likely to benefit from the positive Tesla results concerning his dealings with Twitter: The first interest rate to the tune of a little over $1 billion for the $13 billion loan he took out to buy the social network could become due as early as the end of January.
