Tesla Inc (TSLA)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 17.86% | 18.25% | 25.60% | 25.28% | 21.02% |
| Operating profit margin | 7.24% | 9.19% | 16.76% | 12.12% | 6.32% |
| Pretax margin | 9.14% | 10.33% | 16.80% | 11.55% | 3.21% |
| Net profit margin | 7.26% | 15.50% | 15.41% | 10.25% | 2.29% |
Based on the provided data, Tesla Inc's profitability ratios show a varying trend over the years:
1. Gross Profit Margin: The gross profit margin is a measure of how efficiently a company produces its goods or services. Tesla's gross profit margin has generally improved from 21.02% in December 2020 to 25.60% in December 2022. However, there was a decline in the margin to 17.86% by December 2024, indicating a potential increase in production costs or a change in pricing strategies.
2. Operating Profit Margin: The operating profit margin reflects the company's ability to generate profits from its core operations. Tesla's operating profit margin has shown an increasing trend from 6.32% in December 2020 to 16.76% in December 2022. However, there was a decline in the margin to 7.24% by December 2024, suggesting potential challenges in controlling operating expenses.
3. Pretax Margin: The pretax margin indicates the percentage of revenue that remains after accounting for operating expenses but before taxes. Tesla's pretax margin has fluctuated over the years, reaching a peak of 16.80% in December 2022. However, there was a decrease to 9.14% by December 2024, possibly due to changes in tax rates or other factors.
4. Net Profit Margin: The net profit margin represents the percentage of revenue that translates into profit for the company after all expenses are deducted. Tesla's net profit margin has shown significant improvement from 2.29% in December 2020 to 15.50% in December 2023. However, there was a decline to 7.26% by December 2024, indicating potential challenges in maintaining profitability after accounting for all costs.
Overall, while Tesla's profitability ratios have shown improvement in certain years, there are fluctuations and declines in profitability margins in others, which may warrant further analysis to understand the underlying factors driving these trends.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 5.80% | 8.34% | 16.59% | 10.50% | 3.82% |
| Return on assets (ROA) | 5.81% | 14.07% | 15.25% | 8.88% | 1.38% |
| Return on total capital | 9.70% | 16.21% | 31.05% | 21.83% | 7.92% |
| Return on equity (ROE) | 9.73% | 23.94% | 28.09% | 18.28% | 3.24% |
Tesla Inc's profitability ratios show a positive trend over the years, reflecting improving financial performance.
- Operating return on assets (Operating ROA) increased from 3.82% in 2020 to 16.59% in 2022 before decreasing to 5.80% in 2024. This indicates that Tesla is generating more profit from its operating activities relative to its total assets.
- Return on assets (ROA) has shown a significant improvement, rising from 1.38% in 2020 to 15.25% in 2022. ROA reflects the company's ability to generate profit from its total assets, and Tesla's increasing ROA suggests efficient asset utilization.
- Return on total capital increased from 7.92% in 2020 to 31.05% in 2022, before declining to 9.70% in 2024. This ratio evaluates how effectively the company is generating profits from both debt and equity capital invested in the business.
- Return on equity (ROE) has also seen a notable rise, from 3.24% in 2020 to 28.09% in 2022. ROE measures the return generated on shareholders' equity, indicating Tesla's ability to generate profit for its equity shareholders.
Overall, Tesla Inc's profitability ratios demonstrate a positive performance trajectory, indicating efficient management of assets and capital to generate increasing returns for both the company and its shareholders.