Key Takeaways:
- Tesla released the Second Quarter (Q2) earnings report on July 19.
- The company amassed $25 billion in profits, exceeding expectations.
- As per its shareholder deck, Tesla still holds on to its remaining Bitcoin stash.
YEREVAN (CoinChapter.com) — Elon Musk’s electric vehicle manufacturer, Tesla Inc (NASDAQ: TSLA), released its earning report on July 19, generating a record-breaking $25 billion in revenue in Q2/2023.
Meanwhile, the company held onto its Bitcoin (BTC) stash worth $184 million.
The Tesla-Bitcoin Connection
In February 2021, Tesla acquired $1.5 billion worth of Bitcoin. However, two months later, the company sold 10% of its BTC holdings, noting that they wanted “to prove liquidity of Bitcoin as an alternative to holding cash in the balance sheet.”
Then, in 2022, Tesla dumped 75% of its remaining Bitcoin holdings, eventually retaining only $184 million worth of digital assets.
The company’s decision — to maintain its Bitcoin holdings — came amidst heightened volatility and regulatory scrutiny in the crypto market. Nonetheless, the BTC price has rallied over 80% so far in 2023, in part due to hopes for a rate hike pause and the euphoria surrounding BlackRock’s Bitcoin ETF application.
Tesla shares dip after hours
As its latest earnings report suggests, Tesla has surpassed the expectations set by analysts. The company’s reported adjusted earnings per share of $0.91 exceeded analyst predictions of $0.79. Moreover, Tesla’s Q2 revenue of $24.9 billion also outperformed expectations by 0.81%.
The report comes after the EV vehicle manufacturer implemented cost reductions for its top-selling vehicle models, leading to a significant sales surge. Over the past months, Tesla has repeatedly lowered prices in major markets like the US and China.
Tesla disclosed that its profit margin reached its lowest point in four years. The company’s gross profit margin for the three months ending in June dropped to 18.2%, a notable decrease compared to 26.2% recorded during the previous year.
Meanwhile, Elon Musk does not rule out further price cuts. According to a recent BBC report, Tesla may slash prices further to adjust to current market conditions.
“One day it seems like the world economy is falling apart, next day it’s fine. I don’t know what the hell is going on. We’re in, I would call it, turbulent times,”
he told Wall Street analysts, per the agency.
However, despite these impressive results, the market’s reaction appeared subdued. In after-hours trading, Tesla’s stock price experienced a 4.19% decline, settling at $279.07, as indicated by data from Google Finance.
With its Bitcoin (BTC) holdings still intact, the company has granted massive profits to investors. At the time of writing, the price of Tesla shares remains up shy of 170% year-to-date (YTD). In early January, traders could scoop TSLA stock for $108.10. Today, its price stands at $291.26.
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