When asked about the recession, Elon Musk said that North America is in a pretty good shape while China and Europe are not.
On Wednesday, October 19, electric carmaker Tesla reported its earnings for Q3 stating that it has made no further changes to its Bitcoin holdings.
A quarter before, the electric carmaker sold $1 billion worth of BTC in April 2022 in order to meet the company’s operational costs. But as per the Q3 report released by the company on Tuesday, Tesla still continues to hold around 9,720 Bitcoin worth an estimated $218 million on its balance sheet.
As said, during Q2 Tesla decided to sell off 75% of its Bitcoin holdings to infuse cash on its balance sheet. Back then, the company netted $64 million in profits on the sold BTC stash. The liquidity concerns caused by the COVID-19 lockdown in China forced Tesla to let go of its Bitcoin holdings.
Tesla’s Q3 Results
For the third quarter, Tesla reported its net income at $3.3 billion with automotive gross margins staying steady at 27.9%. During the same period in 2021, Tesla reported $1.62 billion in profits. During his earnings call on Wednesday, Tesla chief Elon Musk answered a few questions regarding market demand and possible share buyback. He said:
“I can’t emphasize enough we have excellent demand for Q4 and we expect to sell every car that we make for as far into the future as we can see. The factories are running at full speed and we’re delivering every car we make, and keeping operating margins strong.”
But Musk stated that the company would be doing a “meaningful buyback” next year. With the board’s approval, it could be anywhere between $5 billion to $10 billion. Musk also shared his bold vision of overtaking Apple by market cap a few years from now.
“I’m of the opinion that we can far exceed Apple’s current market cap. In fact, I see a potential path for Tesla to be worth more than Apple and Saudi Aramco combined. That doesn’t mean it will happen or will be easy,” added he.
Elon Musk on Recession
During the earnings call, shareholders also asked Musk about his views on the current macroeconomic conditions and their impact on their business. The Tesla chief said:
“China is experiencing a recession of sorts and Europe has a recession of sorts driven by energy. North America’s in pretty good health, although the Fed is raising interest rates more than they should, but I think they’ll eventually realize that and bring them down again.”
Musk also spoke about the $44 billion acquisition of the social media platform Twitter.“I think it’s an asset that has sort of languished for a long time but has incredible potential. The long-term potential for Twitter is an order of magnitude greater than its current value,” he added.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
Ecosystem
Research
News Network
About