$Tesla Motors(TSLA)$ is foreca

$Tesla Motors(TSLA)$ is forecast to report a 34% year-on-year rise in revenue to $24.34 billion in the fourth quarter of 2022. Operating income is expected to increase 62% from last year to $4.24 billion while GAAP net income is set to climb 58% to $3.67 billion. If achieved, that puts Tesla on course to report a 52% rise in annual revenue to $81.7 billion over 2022, while both operating profit and net income are both forecast to more than double from last year to $13.95 billion and $12.48 billion, respectively.

Estimates for 2023 have fallen significantly in recent weeks and months as brokers digest softer demand, an uncertain outlook and a potential price war.

Markets currently believe that Tesla will struggle to meet its goal to grow volumes by 50% in 2023 even if they anticipate another year of strong growth. Consensus numbers show Wall Street is expecting Tesla to produce 1.947 million vehicles this year and deliver 1.853 million of them to customers, putting both metrics on course to climb around 41% to 42% in 2023.

Meanwhile, its automotive gross margin is expected to tighten to 27.6% in 2023 from the 29.3% pencilled-in for 2022. The company is now in a position where it may have to see its margin deteriorate in order to deliver its goal to grow volumes by 50% each year, or temporarily give up that ambition to protect profitability. With this in mind, cost control will be key even though inflation appears to be past its peak.

Tesla is forecast to grow revenue by 31% this year, lagging the anticipated rise in volumes as lower prices bite. Earnings are set to increase at an even slower pace as costs continue to rise at a faster pace, with operating profit expected to rise 21% in 2023 while net income is seen climbing 17%.

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