Tesla earnings: 5 must-see metrics highlight strong execution

A new Model S design, soaring free cash flow, and big guidance: Here's what you need to know.

| More on:
tesla shares represented by interior of Tesla model s electric vehicle

Image source: Tesla

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Following an incredible 2020 for Tesla Inc (NASDAQ: TSLA) stock, expectations were high going into the company's fourth-quarter earnings report Wednesday afternoon. Investors in the growth stock were looking for another quarter of meaningful profits and signs that rapid sales growth can persist in 2021 and beyond.

The automaker arguably delivered. Free cash flow soared, management guided for vehicle deliveries to grow even faster in 2021 than they did in 2020, and the company unveiled an all-new Model S interior.

"This past year was transformative for Tesla," management said in the company's fourth-quarter update. "Despite unforeseen global challenges, we outpaced many trends seen elsewhere in the industry as we significantly increased volumes, profitability and cash generation."

Here's a close look at five of the most important metrics from the quarter.

1. Revenue growth of 46%

Fueled primarily by a 61% year-over-year increase in vehicle deliveries, Tesla's fourth-quarter revenue jumped 46%, helping the company cap off a strong year. This put full-year revenue at $31.5 billion, up from $24.6 billion in 2019.

2. Free cash flow of $1.9 billion

Tesla's free cash flow (cash provided by operations less capital expenditures) was $1.9 billion, up from $1 billion in the year-ago period. The company has "sufficient liquidity" to fund its "product roadmap, long-term capacity expansion plans and other expenses," management said.

3. Installed energy storage capacity of 1,584 megawatt-hours

Tesla's energy storage business has been growing sharply recently -- and Q4 was no exception. Quarterly energy storage installations amounted to 1,584 megawatt-hours, up from 530 megawatt-hours in the year-ago quarter. Total 2020 megawatt-hour energy storage deployments were more than 3 gigawatt-hours, up 83% year over year.

4. An operating margin of 5.4%

Tesla's fourth-quarter operating margin of 5.4% put its total 2020 operating margin at 6.3%, up from 0.3% in 2019. Management said it expects its operating margin to continue expanding, eventually reaching "industry-leading levels."

5. An expected increase in vehicle deliveries of more than 50%

Tesla's year-over-year growth of 36% in vehicle deliveries in 2020 was impressive. But 2021 will be even more notable, according to management's projections. In the fourth-quarter update, Tesla said it expects vehicle deliveries to increase more than 50% year over year. This would put total 2021 deliveries at more than 750,000 -- up from about 500,000 deliveries in 2020.

As if these metrics weren't enough for Tesla shareholders to get excited about, Tesla also reiterated some important progress on its product plans. These include starting Model Y production at its Berlin and Texas factories, and launching Tesla Semi -- both this year -- along with an all-new interior design for Tesla's Model S sedan.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Should you invest $1,000 in Block right now?

Before you buy Block shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Block wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on International Stock News

Electric vehicle such as Tesla being charged at charging station.
International Stock News

Tesla searches for Musk successor: Why this matters

Could Elon get the chainsaw from his own board?

Read more »

customers inside and outside a Microsoft retail store
International Stock News

Microsoft shares earnings report: What's the verdict?

Investors moved the Microsoft share price significantly.

Read more »

Warren Buffett
International Stock News

Countdown to Berkshire's AGM: What do investors expect to hear from Warren Buffett this year?

All eyes will be on Omaha, Nebraska this weekend.

Read more »

A smiling woman holds a Facebook like sign above her head.
International Stock News

Meta surges on blockbuster earnings report

It's a good day to be a Meta investor.

Read more »

A family sits on their couch, eyes glued to the television.
International Stock News

Can Netflix be a $1 trillion company by 2030?

How much more can it grow its subscription base?

Read more »

A man looking at his laptop and thinking.
International Stock News

Stock-split watch: Is Nvidia next?

It was nearly one year ago that Nvidia last split its stock.

Read more »

A man looking at his laptop and thinking.
International Stock News

Here's why Berkshire Hathaway stock is a buy before May 2

Giving Buffett and his team your cash to invest for you is likely to be a solid choice no matter…

Read more »

Robot dab indicating a rocketing ASX share price
International Stock News

For Tesla shares, the future rests on autonomous driving and robotics

Tesla has been under pressure lately, with EV demand dwindling.

Read more »