Tesla reported a jump in second-quarter profits Wednesday as a series of price cuts translated into sharply higher car sales.
Elon Musk's fast-growing electric vehicle company reported profits of $2.7 billion, up 20% on the year-ago level.
Revenues surged 47% to $24.9 billion -- a record for the company as auto deliveries surged 83% to 466,140 vehicles.
Total gross margin came in at 18.2%, down from 19.3% in the prior quarter and below the 18.8% expected by analysts.
Tesla characterized the profit margins as "healthy," citing more efficient operations at the newer plants of Berlin and Texas.
The results topped analyst estimates for earnings per share and revenues.
Musk described the current macroeconomic backdrop as "turbulent," noting the drag of high interest rates on consumers and quipping that "one day it seems like the world economy's falling apart and the next day everything's fine."
But executives pointed to a broad-based easing of pressures on key commodities including aluminum and steel, as well key components in batteries such as nickel, cobalt, graphite and lithium.
Wednesday's press release dropped language on supply chain challenges employed in recent earnings statements.
- Price cuts -
Musk has undertaken multiple price cuts throughout 2023 on vehicles, telling investors in April that the company has "taken the view that pushing for higher volumes and a larger fleet is the right choice here versus a lower volume and higher margin."
The move comes as more EVs from legacy carmakers like General Motors and Ford are hitting dealerships.
On Monday, Ford announced price cuts of as much as $10,000 on the F-150 Lightning, an electric version of the best-selling pickup, a move that added to concerns about an oversupply of EVs amid consumer anxiety over lack of charging capacity.
The Ford announcement added to concerns about a potential glut of EVs. EVs currently have more than 100 days of inventory, while industry-wide levels are 53 days, according to a Cox Automotive report.
Shares of Tesla have more than doubled in 2023 so far as investors have overlooked concerns about shrinking profit margins and cheered other recent Musk initiatives.
On Saturday, Tesla unveiled from its Texas factory its first Cybertruck, a futuristic silver vehicle that has been eagerly awaited.
In recent weeks, Musk has also announced collaborations with other auto giants including General Motors and Ford to open up use of Tesla's respected EV charging network.
In March, Musk announced a major new factory in Mexico. He has also met recently with both French President Emmanuel Macron and Indian Prime Minister Narendra Modi about potential investments.
- Hot wheels -
In its press release, Tesla said the Cybertruck "remains on track for initial deliveries this year."
Musk reiterated that plan as far as first deliveries, but avoided very specific targets, pointing to the possibility that supply chain issues could delay a key part.
But Musk said he expects "high volumes" of the Cybertruck next year.
"Demand is so far off the hook, you can't even see the hook," Musk said of customer orders.
The auto company also confirmed its production target of 1.8 million vehicles for all of 2023.
But Musk signaled that production in the third quarter would be "a little bit down" due to factory upgrades.
Shares of Tesla fell 4.2% to 279.08 in after-hours trading.
Copyright 2023, Agence France-Presse