The electric automotive giant Tesla on Wednesday rode rising demand for electric vehicles to a record $5.5 billion profit in 2021 but cautioned that supply chain bottlenecks would continue to crimp production through 2022.
The upbeat outlook from CEO Elon Musk came after the world's most valuable automaker posted record quarterly revenue that beat Wall Street expectations.
The electric carmaker, which scored an 87% jump in auto-deliveries last year despite global semiconductor shortage, reported a 71% rise in revenues to $53.8 billion.
But the cautious note about supply chain woes showed that even Tesla could not avoid the shortages that were pitfalls for many larger automakers last year, and shares fell 0.8% after hours.
"We plan to grow our manufacturing capacity as quickly as possible," it said in a news release that reiterated the company's target of 50% annual growth.
"The rate of growth will depend on our equipment capacity, operational efficiency and the capacity and stability of the supply chain," Tesla said.
"Our own factories have been running below capacity for several quarters as supply chain became the main limiting factor, which is likely to continue through 2022."
Musk said he was heartened by the announced new semiconductor capacity that should alleviate the imbalance by the end of 2022 or early 2023.
He said Tesla's volume growth would comfortably exceed 50% from last year, meaning that Tesla expects to deliver more than 1.4 million vehicles this year.
But "there could be other issues" that surface this year, he said during a conference call with analysts and investors.
Musk cited the supply chain issues as a factor in a decision to defer rollouts of new products this year, adding that the company will do the engineering of its "Cybertruck" electric pickup with an eye toward a possible launch in 2023.
"The fundamental focus of Tesla is scaling vehicles," Musk said and added that had the company introduced new models in 2021, it would have resulted in lower overall production.
Musk has previously also discussed introducing a $25,000 electric vehicle but said that product too was not on the front burner.
"We have too much on our plate," Musk said.
More factories ahead?
Revenue rose to $17.72 billion in the fourth quarter, above analyst estimates for $16.57 billion, according to Institutional Brokers' Estimate System (IBES) data from Refinitiv.
Tesla has fared better than most automakers in managing supply chain issues by using less scarce chips and quickly rewriting software. The automaker last quarter handed over a record number of vehicles to customers despite supply chain headwinds.
Tesla has been ramping up production at factories in California and Shanghai, while also building new facilities in Germany and Texas.
Tesla said its Texas factory will this quarter deliver its first vehicles equipped with its next-generation 4680 batteries made in California as planned.
Tesla said it began building Model Y vehicles in Texas in late 2021, while it started equipment testing in Germany around the same time.
"We are still in the process of finalizing the manufacturing permit from local authorities" in Germany, Tesla said.
Musk said he is looking at adding more manufacturing locations, with further announcements likely in late 2022.
CFRA Research analyst Garrett Nelson characterized the company's cautious remarks on supply chains as unalarming.
"Tesla has become masterful at underpromising and overdelivering and has now beaten (expectations) in nine of the past 10 quarters," Nelson wrote. "We reiterate a 'Buy' opinion," he added.
Tesla shares gained 0.8% reaching $944.50 in after hours trading.
'I would be shocked if we do not achieve full self-driving'
Musk said he expected Tesla's vehicles to achieve full self-driving capability this year. Currently, humans are required to sit behind the wheel to drive the car if needed.
"I would be shocked if we do not achieve full self-driving, safer-than-human this year," he said.
The number of full self-driving beta vehicles in the United States increased to nearly 60,000, up from a few thousand at the end of September. Tesla has been testing the improved version of its automated driving software on public roads, but it has said the features do not make the cars autonomous.
Tesla's $4.09 billion in adjusted earnings before interest, tax, depreciation and amortization (EBITDA) beat the consensus estimate of $3.89 billion, according to Refinitiv. That appeared to qualify Musk for an additional options payout under his 2018 compensation package.
Quarterly profits took a $340 million hit from payroll taxes connected to Musk exercising options related to his 2012 compensation package.
The profits also reflected rising raw material, commodity and logistics costs and expenses related to warranties and recalls. For instance, Tesla is recalling more than 475,000 of its Model 3 and Model S electric cars to address rearview camera and trunk issues that increase the risk of crashing.