For years, Elon Musk had a reputation as a chief executive officer with odd habits. If he had problems, they were largely self-inflicted. His takeover of Twitter has triggered thousands of layoffs and worries that he will not keep hate speech off the platform. What is forgotten in this mix is that he built the first viable electric car company, which is still the largest. He also built what may be the most successful rocket firm in history.
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Tesla announced quarterly results this week and beat expectations handily. Revenue reached $24.32 billion, just above consensus figures, and earnings of $1.19 per share also topped forecasts. Gross margins dropped to a recent low of 25.9%. That figure may remain low, as Tesla has reduced car prices to improve sales. It is also the byproduct of what may become a price war in the industry. (Click here for the most efficient cars on the market.)
Tesla’s car sales may reach 2 million this year, keeping it well ahead of its competition. The only market it will not dominate completely is China.
Tesla management said there were a number of costs that could be cut as the company moves into what it forecasts as a brutal recession. That means gross margins may not suffer significantly.
It is worth returning to one number. In a world in which every major car company in the world has invested billions of dollars into electric vehicles, Tesla expects sales to rise to 2 million vehicles this year.
Musk’s other creation, SpaceX, can reuse the rocket’s first stage by landing it after takeoff. Other rocket companies are set up so that these components fall into the sea. That means consumers had to pay over and over again for what Musk can charge much less for. Even NASA uses SpaceX rockets today.
24/7 Wall St.Musk also has built a low-orbit satellite internet system called Starlink. It will have over 3,000 satellites circling the earth that will offer internet service virtually everywhere in the world. It is currently in use by the Ukrainian government.
Musk has made headlines with Twitter and behavior many people find offensive. He also has completely changed two of the world’s most important industries.
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