China EV giant BYD reported mixed third-quarter results on Wednesday, but surpassed Tesla revenue for the first time.
BYD stock closed flat Wednesday, slightly extended from a buy zone. Tesla stock edged lower, continuing to fall slightly from a buy point after skyrocketing last week on earnings.
BYD Earnings
BYD net income rose 11.5% to 11.6 billion yuan, or $1.6 billion, slightly exceeding consensus.
Revenue climbed 24% in local currency terms to $28.2 billion. That fell short of estimates of for $28.3 billion. But that easily topped Tesla's Q3 revenue of $25.182 billion. The faster-growing BYD has come close to passing Tesla revenue in recent quarters, but this would be a new milestone for BYD.
Heading into the Q3 earnings report, analysts expected BYD to generate $35.71 billion in sales. That would hit $105.938 billion for 2024, up from $83.324 billion in 2023 and $33.258 billion in 2021.
Tesla's Q4 sales are expected to climb to $27.368 billion, bringing full-year revenue at $99.921 billion vs. $96.773 billion in 2023 and $53.823 billion in 2021.
Both BYD and Tesla get the vast majority of their revenue from EV sales, but both have other businesses such as energy storage. BYD Electronics makes handset components and does some smartphone assembly, including for the Apple iPhone.
BYD Vs. Tesla EV Sales
BYD vehicle sales passed Tesla's back in Q2 2022 and are now more than twice as high: 1.135 million vs. 462,890.
However, Tesla makes only fully battery electric vehicles (BEVs). The China EV giant makes both BEVs and plug-in hybrids (PHEVs). PHEV sales has surged this year due to a more-advanced hybrid system.
BYD did top Tesla in BEV sales in Q4 2023 but the latter has retaken the lead in 2024. BYD's BEV sales were 443,426 in Q3 2024.
BEV sales are likely to be close once again in Q4, as both EV giants push hard to close out the year.
BYD's total sales may hit four million for the year, up from 3.02 million in 2023. Tesla CEO Elon Musk said he expects his company's deliveries to edge last year's 1,808,581, which will require a big Q4 performance.
BYD will release October EV sales figures on Nov. 1-2.
Tesla Still More Profitable
Tesla earnings have struggled over the past few years but are still significantly higher than BYD's. The U.S. EV giant's GAAP net income was $2.167 billion in Q3. BYD's was $1.6 billion.
Meanwhile, Tesla vehicles still have significantly higher average selling price than BYD, which has an array of price points but dominates the low-end China EV market.
Yet BYD gross margins are significantly higher than Tesla. Tesla's gross margin rebounded to 19.8% in Q3, up 195 basis points vs. a year earlier. But BYD's gross margins was 21.89% vs. 18.96% a year earlier. BYD margins excluding the Electronics division popped to 23.51% vs. 22.51% in Q3 2023.
BYD, which is in expansion mode, has been ramping up capital spending and research & development spending far faster than sales. BYD's capex was 20.3% of revenue in 2023. That's vs. just 9.2% last year for Tesla, though that picked up to almost 14% in Q3.
BYD Stock
BYD stock, which trades over the counter in the U.S., finished unchanged at 38.37. Shares are just out of a buy zone from a 40%-deep, 14-month cup base.
BYD first cleared the 36.27 buy point on Oct. 1. Shares ran up to 42, then pulled back below the buy point before rebounding again.
Investors could view the recent action as a high handle to the cup base or as a handle to a two-year base going back to the June 2022 peak.
BYD stock was up 38.6% in 2024 as of Oct. 30.
Tesla Stock
Tesla stock was up 3.65% so far in 2024 as of Oct. 30, according to MarketSurge analysis.
Shares dipped 0.8% Wednesday to 257.55, a third straight decline. On Monday, Tesla hit a 13-month high intraday before reversing lower, back below a 264.86 cup-with-handle buy point on Friday. However, the EV giant spiked 22% last week on earnings.
In terms of valuation, Tesla stock is still far ahead. Its market cap was $826.75 billion as of Oct. 30 vs. BYD's $104.7 billion.
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