Tesla earnings report—new EVs delayed, full speed ahead on humanoid robot

Tesla’s latest earnings report, for the fourth quarter and full year 2021, was another strong one. Deliveries grew by 87% in 2021, earnings per share and revenue each beat analyst estimates by over 6%, and the company claimed that it achieved “the highest quarterly operating margin among all volume OEMs…demonstrating that EVs can be more profitable than combustion engine vehicles.” Tesla also confirmed that Model Y production has begun at Gigafactory Texas, and that it’s only waiting for final certification to start deliveries.

In response to all this great news, TSLA stock tanked—it lost over 10% the day after the report, and is still in freefall at this writing. To a certain extent, this is standard procedure—investor expectations for Tesla have flown so high for so long that even spectacular earnings news is considered mediocrity. However, most of the stock pundits seem to believe that the main reason for the sudden souring is the fact that the launch of Tesla’s Cybertruck and Semi will be delayed until “hopefully next year.”

Each of these vehicles has the potential to open up an important new segment to electrification, and the continued delays are bad. However, they aren’t news—the media has been discussing the plight of the two stalled trucks for weeks.

At least one Tesla-watcher believes that the real reason for the stock slide is a sense that the company is straying from its mission of electrifying transport. At a time when Tesla should be calling all hands on deck to bring its new vehicles to market, the mercurial Mr. Musk spent much of his time on the earnings call discussing other projects. Explaining why Tesla isn’t working on a new, lower-priced model, he conceded, “We have enough on our plate right now, too much on our plates, frankly.”

An overloaded plate is a common problem in our spoiled society, but an overeager visitor to an all-you-can-eat buffet can always remove the lime Jell-O and sheet cake from their tray in order to make room for meat and potatoes.

Tesla seems to have plenty of room on its plate for robotaxis. “The thing that overwhelmingly matters is when is the car autonomous,” said Musk, adding that “my personal guess is that we’ll achieve Full Self-Driving this year.” A certain Tesla-bashing web site claimed that this is the ninth year in a row that Musk has made that prediction.

Also occupying a prominent place on the piled-high plate is the humanoid robot now dubbed (with an unintentional second level of irony) Optimus Subprime. “In terms of priority of products, I think actually the most important product development we’re doing this year is the Optimus humanoid robot,” said the man who, in his younger days, donned his armor and set out to slay the dragon of climate change.

As for the practical purpose of this robot, Musk served up only this word salad: “The foundation of the economy is labor. Capital equipment is distilled labor. So what happens if you don’t actually have a labor shortage? I’m not sure what an economy even means at that point. That’s what Optimus is about, so, very important.”

Most of the EV press devoted little ink to the robot, preferring to focus on the positives in the report. However, Electrek called the announcement “quite a surprising change of strategy.” Autoblog was skeptical of Musk’s claim that the robot “has the potential to be more significant than the vehicle business,” calling it (with understatement) “a tall order, at least from an earnings perspective.”

As intended, the Lost In Space reject got a lot of headlines in the mainstream media, though not much respect. CNBC called the robot project “an example of Musk’s showmanship,” and lamented that “it’s more important for Tesla to make a robot than new car models this year,” but injected a hopeful note, speculating that the robot “could be years away and may never come to fruition.”

Actually, given Tesla’s robust demand and constrained supply, it’s probably not a bad idea for the company to defer introducing new models at this time. However, it’s definitely a bad idea to divert resources from getting the highly-anticipated Semi and Cybertruck into production, while hyping a vanity project that has nothing whatsoever to do with Tesla’s stated mission.

Sources: Tesla, Electrek, Autoblog, CNBC