For the first time this earnings season, an electric vehicle manufacturer (other than Tesla) reported a profit.
Polestar (PSNY), a Swedish company backed by Volvo and China’s Geely, reported its first gross profit as a public company since the completion of its SPAC merger earlier this year.
Though Polestar missed on the top line, sales were up 105% year on year, enough to eke out a $4 million gross profit for the quarter. In comparison to last year, the company was able to cut its operating loss in the third quarter by one-third.
Polestar earned $54 million in gross profit on $1.48 billion in sales in the first nine months of the year. Polestar delivered 30,424 cars globally during that time period, and the company said it was on track to meet its 50,000-car delivery target for the year. The company anticipates $2.4 billion in sales for the year, with performance “driven by strong Q4 2022 sales.”
Polestar also stated that it was adequately funded through 2023, citing a $1.6 billion financing package provided by its corporate parents Volvo and Geely.
Polestar says its product pipeline will include the Polestar 4 SUV in 2023, the Polestar 5 grand touring sedan in 2024, and the Polestar 6 roadster in 2026. Polestar previously announced that its Polestar 3 SUV would be available in the fourth quarter of next year, and that it would be manufactured at Volvo’s plant in South Carolina beginning in mid-2024.
However, Polestar CEO Thomas Ingenlath stated that supply chain issues and parts shortages would impede production.
“Will things improve next year? No, we expect this to be something that keeps us busy,” Ingenlath said at a press conference. Polestar cut its production forecast earlier this year from 65,000 to 50,000 due to COVID-related shutdowns in China. Polestar automobiles are manufactured in Chengdu, China.
Nonetheless, Polestar shares are up today as a result of today’s news. Polestar has been able to leverage the manufacturing and technology capabilities of Volvo and Geely to see its “asset-light” business model succeed when other pure-play EV rivals like Rivian (RIVN), Lucid (LCID), and even Nio (NIO) struggle for profitability thanks to the support of its corporate parents.
