Elon's Big Day

It's no secret the world's richest man can't resist a 4/20 joke. Elon Musk famously tweeted he had secured funding to take Tesla private at $420. Earlier this month, he offered to buy Twitter at $54.20 a share. The Tesla chief celebrated the cannabis holiday after the market closed with an earnings report shocker.

The report was surprisingly great, according to my Barron's colleague Al Root.

The company essentially beat inflation by substituting materials and relentlessly focusing on manufacturing. Shares are higher in after-hours trading Wednesday, recouping losses seen earlier in the day.

Tesla (ticker: TSLA) earned a record $3.22 per share from $18.8 billion in total sales, its highest total ever. Wall Street was looking for earnings per share of about $2.20 to $2.30 from about $18 billion in sales. In the fourth quarter of 2021, Tesla earned $2.54 a share on sales of $17.7 billion.

Operating profit came in at a record $3.6 billion, compared with expectations for about $2.6 billion.

Al notes that analysts had anticipated an earnings decline from the fourth quarter because of inflation. He writes that long-term contracts may help explain part of the lower-than-expected impact.

Tesla also expects 50% growth in vehicle production in 2022 compared with 2021, and Musk believes there's a "reasonable shot"  at 60% growth. Al continues:

That will soothe investors who are worried about production rates. Tesla’s Shanghai facility shut at the end of March due to local Covid restrictions. Limited production has begun again, but the situation is still fluid.

At 55% volume growth, the mid-point of Musk’s numbers, Tesla would deliver about 1.45 million vehicles in 2022. That’s close to what Wall Street expects.

Musk also said the company is working on a new vehicle dedicated to robotaxis. Tesla continues to invest heavily in its self-driving software and technology.

The results sparked a 5.3% jump in extended trading this evening.

Read more of Al's coverage here.