Tesla Releases Fourth Quarter Result, Misses Wall Street Revenue Prediction But Beats Earnings
Automaker and clean energy company Tesla on Wednesday released its fourth-quarter results, missing wall street revenue prediction but surpassed that of earnings.
The Wall Street consensus for Tesla’s Fourth quarter (Q4) earnings was $24.6 billion in revenue and earnings of $1.13 per share. Meanwhile, Tesla’s revenue was down $280 million from wall street expectations, after it posted a revenue of $24.32 billion million but beat the earnings expectations with $1.19 per share.
At the end of the Fourth quarter (Q4), Tesla had $1.4 billion in free cash flow, down from the $3.3 billion cash flow recorded in the third quarter. Its stock witnessed a 3.2% spike to $149 per share after the earnings report became public and has continued to rise to $151.52 in the premarket.
Tesla closed the quarter (Q4) with a 16% operating margin, while its Automotive gross margins came in at 25.9%, the lowest figure in the last five quarters. Also, its operating cash flow was down 29% from last year, and down 36% from last quarter, coming in at $3.28 billion.
In terms of deliveries, the company disclosed it produced over 439,000 vehicles and delivered over 405,000 vehicles, bringing Tesla’s 2022 full-year deliveries to around 1.31 million vehicles.
Investors King understands that in 2022, the automaker slashed the prices of its vehicles around the world, a strategy that sparked demand for its vehicles.
Speaking on the slash of its vehicles, the company CEO Elon Musk said, “Price matters, the vast number of people that want to buy a Tesla car, can’t afford it, and so these price changes really make a difference for the average consumer.”
In October 2022, Tesla announced price cuts in China by up to 9% on the Model 3 and Model Y, reducing prices further by nearly 14%.
Earlier this month, it lowered the price of its long-range Model Y crossover (20% to $52,990) and Model 3 Sedan (14% to 53990) for U.S. buyers.
Musk disclosed that after Tesla slashed the prices of its vehicles, January saw the strongest demand ever in Tesla’s history, which he said that the demand exceeded production.
On the other hand, Tesla on Tuesday announced plans to invest $3.6 billion more into its Gigafactory in Nevada, adding two new facilities dedicated to building battery cells and Tesla semis, as it disclosed plans to boost production by 50% this year.
Unilever Nigeria to Focus on Higher Growth Opportunities by Exiting Home Care and Skin Cleansing Markets
Unilever Nigeria Plc, one of the leading Fast-Moving Consumer Goods (FMCG) companies, has announced its decision to exit the home care and skin cleansing markets.
The company disclosed that the decision would only affect three of its brands – OMO, Sunlight, and Lux. According to Unilever Nigeria, the move is aimed at accelerating the growth of the organisation and sustaining profitability.
The restructuring of Unilever Nigeria’s business model is in response to the tough business environment in Nigeria, where many organisations and individuals have found it difficult to access cash due to the Naira redesign policy of the Central Bank of Nigeria (CBN).
Unilever Nigeria’s Managing Director, Mr Carl Cruz, noted that the offloading of the home care and skin cleansing portfolios would enable the company to “concentrate on higher growth opportunities.”
Unilever Nigeria has a strong competition in the business categories it is exiting. However, the company’s products are also market leaders in the sector. Mr Cruz added that the company was repurposing its portfolio by gradually exiting two categories, home care and skin cleansing, affecting only three brands (OMO, Sunlight, and Lux).
This would allow Unilever Nigeria to drive the rest of its brand portfolio for growth into the future and strengthen business operations with measures to digitize and simplify processes.
Unilever Nigeria is a truly Nigerian business and the oldest serving manufacturer in the country. The company’s decision to exit the home care and skin cleansing markets is in line with its commitment to adapt to changing market circumstances and reposition itself to better meet the needs of its consumers, shareholders, and employees.
Mr Cruz said, “By making these changes, we will unleash the sustained and profitable growth we need to be here for the next 100 years as well.”
Merger and Acquisition
Access Bank Zambia Granted Approval for Atlas Mara Zambia Merger
Access Holdings Plc has announced that its subsidiary, Access Bank Zambia Limited, has received final regulatory approval from the Central Bank of Zambia for the acquisition and merger of African Banking Corporation Zambia Limited (Atlas Mara Zambia).
The move is a significant step towards the creation of one of the top five banks in Zambia.
Sunday Ekwochi, Company Secretary of Access Holdings, stated that the latest development is a big step towards the earlier announcement made on October 25, 2021.
This approval comes after the Central Bank of Nigeria (CBN) and Common Market for Eastern and Southern Africa Competition Commission granted their “no objection” to the transaction in 2022.
Access Zambia will now begin the process of integrating and merging Atlas Mara Zambia into its existing operations. The merger is expected to boost Access Bank Zambia’s position in the Zambian banking sector and create more opportunities for its customers.
Access Holdings Plc is committed to expanding its operations and presence in Africa, and this acquisition and merger is a testament to its efforts in achieving that goal. The company believes that this move will strengthen its position as a leading financial services provider in the region.
Dr. Herbert Wigwe, Group Chief Executive Access Holdings, while commenting on the transaction, said: “The transaction builds on our earlier acquisition and merger of Cavmont Bank Plc into Access Bank Zambia and underscores our resolve to strengthen our presence in Zambia, a key African market that fits into our strategic focus on geographic earnings growth and diversification”.
Merger and Acquisition
First Citizens BancShares Acquires Silicon Valley Bank’s Deposits and Loans in FDIC-Assisted Deal
On Monday, First Citizens BancShares Inc announced that it had acquired the deposits and loans of Silicon Valley Bank (SVB) following its failure earlier this month.
This acquisition marks a significant step forward in addressing the global financial markets’ ongoing crisis of confidence.
As part of the deal, First Citizens BancShares will assume SVB’s assets including $110 billion in assets, $56 billion in deposits, and $72 billion in loans. The Federal Deposit Insurance Corporation (FDIC), which took control of SVB, will receive equity appreciation rights in First Citizens BancShares stock with a potential value of up to $500 million.
First Citizens BancShares described itself as having completed more FDIC-assisted transactions since 2009 than any other bank. It believes that the combined company will be resilient with a diverse loan portfolio and deposit base.
The bank’s statement also noted that its prudent risk management approach would continue to protect customers and stockholders through all economic cycles and market conditions.
In addition to the acquisition, First Citizens BancShares will receive a line of credit from the FDIC for contingent liquidity purposes. Again, the bank will have an agreement with the regulator to share some losses on commercial loans to provide further downside protection against potential credit losses.
While analysts said the move was positive for financial stability and the venture capital industry, they noted that it only addressed the issue of deposits leaving smaller banks for larger banks or money market funds up to a point.
Redmond Wong, Greater China market strategist at Saxo Markets, said that “First Citizens Bank’s acquisition of the SVB loan book and deposits does not add much to solve the number one issue that the U.S. banking system is now facing.”
SVB’s failure was the largest bank to fail since the 2008 financial crisis. Its closure on March 10th caused massive market disruption and heightened stresses across the banking sector globally. The acquisition of its deposits and loans by First Citizens BancShares is a step towards stabilizing the sector and restoring confidence in the global financial markets.
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