After a run of strong quarter-on-quarter growth to revenues on ramped up production, Tesla has reported a 9.7% drop in Q2 revenues over Q1. The decline reflected supply shortages, most notably pandemic-related disruption to operations at its Shanghai plant.

However, at $16.9bn, revenues were still 42% ahead of last year. Many analysts also noted that Tesla price increases have protected Tesla’s profits to leave them above expectations (operating income at $2.5bn in Q2; compares with $3.6bn in Q1 and $1.3bn in Q2 2021).

In recent comments to media, Tesla founder Elon Musk has defended increases to Tesla list prices saying that they will come down when cost pressures for the company subside.

In a statement to investors, Tesla said it continued to significant progress across the business during the second quarter of 2022 despite challenges such as limited production and shutdowns in Shanghai for the majority of the quarter.

Tesla achieved an operating margin in the quarter of 14.6%, ‘among the highest in the industry’, it said.

New factories in Berlin-Brandenburg and Austin continued to ramp up volumes in Q2. Gigafactory Berlin-Brandenburg reached an important milestone of over 1,000 cars produced in a single week while achieving positive gross margin during the quarter. From Tesla’s Austin factory, the first vehicles with Tesla-made 4680 cells and structural battery packs were delivered to US customers.