Q4 and FY2020 Update Q4 and FY2020 Update Highlights 03 Financial Summary 04 Operational Summary 07 Vehicle Capacity 08 Core Technology 09 Other Highlights 10 Outlook 11 Photos & Charts 12 Key Metrics 25 Financial Statements 27 Additional Information 33 This past year was transformative for Tesla. Despite unforeseen global challenges, we outpaced many trends seen elsewhere in the industry as we significantly increased volumes, profitability and cash generation. For the full year 2020, we achieved an industry-leading1 6.3% operating margin (despite an increase of SBC to $1.7B). Teams across our organization, including supply chain, manufacturing, logistics and delivery, rose to the occasion to ensure strong execution. In addition, we continued to improve our products and make progress on our long-term roadmap. We ramped Model 3 in China to over 5,000 cars per week and started production of Model Y at Gigafactory Shanghai less than a year after breaking ground on the expansion. We also launched and ramped Model Y in Fremont in 2020. In Berlin and Austin, we remain on track to start vehicle production this year with structural batteries leveraging in-house battery cells. Our engineering team has made significant progress on Full Self Driving (FSD) software, with a limited release to customers. Finally, we are excited to ramp the updated Model S and Model X and deliver our first Tesla Semi by the end of the year. While 2020 was a critical year for Tesla, we believe that 2021 will be even more important. Thank you for your trust and support and for being on this journey with us. Operating cash flow less capex (free cash flow) of $2.8B in 2020 $4.9B increase in our cash and cash equivalents in Q4 to $19.4B Free cash flow $1.9B in Q4 Cash Half a million vehicles produced and delivered in 2020 Model Y production at Gigafactory Shanghai started in December 2020 Updated Model S and Model X launched in January 2021 Profitability $721M GAAP net income; $2.5B non-GAAP net income in 2020 $270M GAAP net income; $903M non-GAAP net income (ex-SBC*) in Q4 $575M GAAP operating income; 5.4% operating margin in Q4 SBC expense increased to $633M in Q4 Operations S U M M A R YH I G H L I G H T S 3 *SBC = stock-based compensation 1 Based on latest available trailing 12- F I N A N C I A L S U M M A R Y (Unaudited) 4 ($ in millions, except percentages and per share data) Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020 YoY Automotive revenues 6,368 5,132 5,179 7,611 9,314 46% of which regulatory credits 133 354 428 397 401 202% Automotive gross profit 1,434 1,311 1,317 2,105 2,244 56% Automotive gross margin 22.5% 25.5% 25.4% 27.7% 24.1% 157 bp Total revenues 7,384 5,985 6,036 8,771 10,744 46% Total gross profit 1,391 1,234 1,267 2,063 2,066 49% Total GAAP gross margin 18.8% 20.6% 21.0% 23.5% 19.2% 39 bp Operating expenses 1,032 951 940 1,254 1,491 44% Income from operations 359 283 327 809 575 60% Operating margin 4.9% 4.7% 5.4% 9.2% 5.4% 49 bp Adjusted EBITDA 1,175 951 1,209 1,807 1,850 57% Adjusted EBITDA margin 15.9% 15.9% 20.0% 20.6% 17.2% 131 bp Net income attributable to common stockholders (GAAP) 105 16 104 331 270 157% Net income attributable to common stockholders (non-GAAP) 386 227 451 874 903 134% EPS attributable to common stockholders, diluted (GAAP) (1) 0.11 0.02 0.10 0.27 0.24 118% EPS attributable to common stockholders, diluted (non-GAAP) (1) 0.41 0.23 0.44 0.76 0.80 95% Net cash provided by (used in) operating activities 1,425 (440) 964 2,400 3,019 112% Capital expenditures (412) (455) (546) (1,005) (1,151) 179% Free cash flow 1,013 (895) 418 1,395 1,868 84% Cash and cash equivalents 6,268 8,080 8,615 14,531 19,384 209% (1) Prior period results have been retroactively adjusted to reflect the five-for-one stock split effected in the form of a stock dividend in August 2020. EPS = Earnings per share F I N A N C I A L S U M M A R Y (Unaudited) 5 ($ in millions, except percentages and per share data) 2016 2017 2018 2019 2020 YoY Automotive revenues 6,351 9,642 18,515 20,821 27,236 31% of which regulatory credits 302 360 419 594 1,580 166% Automotive gross profit 1,601 2,209 4,341 4,423 6,977 58% Automotive gross margin 25.2% 22.9% 23.4% 21.2% 25.6% 437 bp Total revenues 7,000 11,759 21,461 24,578 31,536 28% Total gross profit 1,599 2,223 4,042 4,069 6,630 63% Total GAAP gross margin 22.8% 18.9% 18.8% 16.6% 21.0% 447 bp Operating expenses 2,267 3,855 4,430 4,138 4,636 12% (Loss) income from operations (667) (1,632) (388) (69) 1,994 N/A Operating margin -9.5% -13.9% -1.8% -0.3% 6.3% 660 bp Adjusted EBITDA 832 644 2,395 2,985 5,817 95% Adjusted EBITDA margin 11.9% 5.5% 11.2% 12.1% 18.4% 630 bp Net (loss) income attributable to common stockholders (GAAP) (675) (1,962) (976) (862) 721 N/A Net (loss) income attributable to common stockholders (non-GAAP) (341) (1,495) (227) 36 2,455 6,719% EPS attributable to common stockholders, diluted (GAAP) (1) (0.94) (2.37) (1.14) (0.98) 0.64 N/A EPS attributable to common stockholders, diluted (non-GAAP) (1) (0.47) (1.80) (0.27) 0.03 2.24 7,367% Net cash (used in) provided by operating activities (124) (61) 2,098 2,405 5,943 147% Capital expenditures (1,281) (3,415) (2,101) (1,327) (3,157) 138% Free cash flow (1,405) (3,476) (3) 1,078 2,786 158% Cash and cash equivalents 3,393 3,368 3,686 6,268 19,384 209% (1) Prior period results have been retroactively adjusted to reflect the five-for-one stock split effected in the form of a stock dividend in August 2020. EPS = Earnings per share F I N A N C I A L S U M M A R Y Revenue Profitability Cash Total revenue grew 46% YoY in Q4. This was primarily achieved through substantial growth in vehicle deliveries as well as growth in other parts of the business. At the same time, vehicle average selling price (ASP) declined by 11% YoY as our product mix continued to shift from Model S and Model X to the more affordable Model 3 and Model Y. Our operating income improved in Q4 compared to the same period last year to $575M, resulting in a 5.4% operating margin. Thi s profit level was reached while incurring SBC expense attributable to the 2018 CEO award of $267M in Q4, driven by an increase in our market capitalization and a new operational milestone becoming probable. Positive impact from volume growth and regulatory credit revenue growth YoY was mainly offset by lower ASP (including price reduction of China-made Model 3 and price reductions of Model S and Model X before the introduction of updated models) but also by a series of notable items. These included a portion of Q4 SBC charges, vehicle warranty accruals, additional supply chain cos ts, Model S and Model X changeover costs and other items. Quarter-end cash and cash equivalents increased to $19.4B in Q4, driven mainly by our recent capital raise of $5.0B (average pri ce of this offering was ~$632/share) and free cash flow of $1.9B, partially offset by early debt repayments (early conversion of convert ible notes). 6 Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020 YoY Model S/X production 17,933 15,390 6,326 16,992 16,097 -10% Model 3/Y production 86,958 87,282 75,946 128,044 163,660 88% Total production 104,891 102,672 82,272 145,036 179,757 71% Model S/X deliveries 19,475 12,230 10,614 15,275 18,966 -3% Model 3/Y deliveries 92,620 76,266 80,277 124,318 161,701 75% Total deliveries 112,095 88,496 90,891 139,593 180,667 61% of which subject to operating lease accounting 8,848 6,104 4,716 10,014 13,636 54% Total end of quarter operating lease vehicle count 49,901 53,159 54,519 61,638 72,089 44% Global vehicle inventory (days of supply)(1) 10 25 17 14 11 10% Solar deployed (MW) 54 35 27 57 86 59% Storage deployed (MWh) 530 260 419 759 1,584 199% Store and service locations 433 438 446 466 523 21% Mobile service fleet 743 756 769 780 823 11% Supercharger stations 1,821 1,917 2,035 2,181 2,564 41% Supercharger connectors 16,104 17,007 18,100 19,437 23,277 45% (1) ned with Automotive News definition). 7 O P E R A T I O N A L S U M M A R Y (Unaudited) 0.0% 0.5% 1.0% 1.5% 2012 2013 2014 2015 2016 2017 2018 2019 2020 US / Canada Europe China Global market share of Tesla vehicles by region V E H I C L E C A P A C I T Y Fremont Over the past few weeks, we have been upgrading our Fremont Factory to launch the new Model S and Model X. These changes include a new powertrain (battery modules, battery packs, drive units), an entirely new interior, exterior updates and other improvements. Production will resume in Q1 and ramp back to full capacity over time. We also continue to increase Model Y production, including integration of the single-piece rear underbody castings, to meet customer demand. Shanghai Gigafactory Shanghai has demonstrated the ability to sustain Model 3 production at or above a run rate of 250,000/year. Model Y production started in late 2020 and is in the process of ramping to full capacity. Customer response to both Model 3 and Model Y continues to be strong. We recently started shipping Model 3 vehicles from Gigafactory Shanghai to several countries in Europe and APAC, which supplements production from the Fremont Factory for those markets. Berlin-Brandenburg Local production and deliveries remain a key part of our growth strategy. While our total market share in Europe increased in 2020, Gigafactory Berlin should enable a significant increase in local deliveries, similar to what we saw after constructing Gigafactory Shanghai. Buildout of our Berlin factory continues as planned, and we have already started to move machinery into the building. Installed Annual Capacity Current Status Fremont Model S / Model X 100,000 Production Model 3 / Model Y 500,000 Production Shanghai Model 3 / Model Y 450,000 Production Berlin Model Y - Construction Texas Model Y - Construction Cybertruck - In development TBD Tesla Semi - In development Roadster - In development Future Product - In development 8 Installed capacity ≠ Current production rate. The production rate depends on the pace of factory ramp, supply chain ramp, downtime related to factory upgrades and national holidays and other factors. Source: Tesla estimates based on data from ACEA; Autonews.com; CAAM (light-duty vehicle only) Model 0-60 mph 1/4 mile Tesla Model S Plaid <2.0 sec <9.3 sec Porsche 918 Spyder 2.1 sec 9.7 sec Porsche 911 Turbo S (992) 2.2 sec 10.1 sec Lamborghini Huracán Performante 2.2 sec 10.2 sec Tesla Model S Performance 2.3 sec 10.4 sec Dodge Challenger SRT Demon 2.3 sec 10.7 sec Bugatti Chiron 2.4 sec 9.4 sec Porsche Taycan Turbo S 2.4 sec 10.3 sec Nissan GT-R Nismo 2.5 sec 10.8 sec Bugatti Veyron 2.5 sec 9.9 sec C O R E T E C H N O L O G Y Autopilot & Full Self Driving (FSD) Over the last few months, we released multiple software updates to our FSD City Streets beta testers.1 With each iteration, the system is becoming more robust, resulting in the widening of our user base. We continue to work on the development of our Dojo supercomputer. This computer is designed to process video data from our fleet and train our neural network at an extremely fast rate. Vehicle Software As has been the tradition in recent years, we released a holiday software update for our vehicles in December. This time, we included a variety of new games, enabled drivers to make an entrance with custom horn sounds through the external speaker and improved driving visualization among many other updates. Battery & Powertrain While our Model S and Model X battery module architecture evolved over the past 8 years, both the battery pack and modules have now been fully redesigned. Additionally, we have incorporated Model 3 and Model Y motor technology throughout as well as our heat pump for better winter range. These changes enable 5x more high-speed quarter- mile runs than the prior architecture, while further improving energy efficiency. The Performance versions of Model S and Model X were replaced by Plaid, featuring a tri-motor powertrain with a unique high-speed, high-power rotor. Model S Plaid is the fastest accelerating production car ever made with a 0-60 mph time of <2.0 seconds and a quarter mile in under 9.3 seconds, faster than a Bugatti Chiron. EPA est. range gap continues to widen 9 The fastest accelerating production cars ever made 0 50 100 150 200 250 300 350 400 450 Jan-2019 Jan-2020 Jan-2021 Tesla Model S (AWD) Highest range non-Tesla EV (AWD) Sources: Tesla; Auto Motor & Sport; Car and Driver; CarIndigo; Carscoops; Hot Rod, Motor Trend; Road & Track; TopSpeed Sources: Tesla; OEM data 1 No revenue is recognized for software released for initial FSD City beta testers O T H E R H I G H L I G H T S Energy Storage Energy storage deployments grew substantially from 2019 to 2020. For the first time, our total battery deployments surpassed 3 GWh in a single year, which is an 83% increase compared to the prior year. This growth was driven mainly by the popularity of Megapack, our utility scale storage product. Powerwall demand continues to increase as the residential business continues to grow. While we have made progress on production, we should se e even further increases in supply in the next few months. Our energy storage business continues to be supply-constrained as backlog remains strong. We are looking to increase capacity both on the manufacturing equipment side as well as supply chain side, to allow us to continue to grow at a similar pace again in 2021. Solar Retrofit and Solar Roof In 2020, solar deployments increased to 205 MW, 18% more than the prior year. This growth is the result of meaningful improve ments to our solar retrofit strategy, including product simplification, cost reduction and industry-leading pricing. We have also made great progress growing our Solar Roof deployments, as we have expanded the team while simultaneously improving our installation efficiency. Tesla energy storage deployments in GWh 10 0.0 0.5 1.0 1.5 2.0 2.5 3.0 2015 2016 2017 2018 2019 2020 O U T L O O K Introduction Volume Cash Profit Product Given the number of significant projects in the pipeline, we have simplified our approach to guidance for 2021, enabling our teams to remain focused on achieving our long-term goals. We are planning to grow our manufacturing capacity as quickly as possible. Over a multi-year horizon, we expect to achieve 50% average annual growth in vehicle deliveries. In some years we may grow faster, which we expect to be the case in 2021. The rate of growth will depend on our equipment capacity, operational efficiency and capacity and stability of the supply cha in. We have sufficient liquidity to fund our product roadmap, long-term capacity expansion plans and other expenses. We expect our operating margin will continue to grow over time, continuing to reach industry-leading levels with capacity expansion and localization plans underway. We are currently building Model Y capacity at Gigafactory Berlin and Gigafactory Texas and remain on track to start deliverie s from each location in 2021. Gigafactory Shanghai will continue to expand further through the course of the year. Tesla Semi deliveries will also begin in 2021. 11 P H O T O S & C H A R T S T E S L A M O D E L S - F R O N T I N T E R I O R 13 T E S L A M O D E L S - R E A R I N T E R I O R 14 T E S L A M O D E L S P L A I D - E X T E R I O R 15 G I G A F A C T O R Y S H A N G H A I - M O D E L Y D I E C A S T 16 G I G A F A C T O R Y S H A N G H A I - M O D E L Y S T A M P I N G 17 G I G A F A C T O R Y S H A N G H A I - M O D E L Y B O D Y S H O P 18 G I G A F A C T O R Y S H A N G H A I - M O D E L Y G E N E R A L A S S E M B L Y 19 G I G A F A C T O R Y S H A N G H A I - M O D E L 3 F A C T O R Y ( F O R E G R O U N D ) ; M O D E L Y F A C T O R Y ( B A C K G R O U N D ) 20 21 G I G A F A C T O R Y B E R L I N - M O D E L Y F A C T O R Y C O N S T R U C T I O N 22 G I G A F A C T O R Y B E R L I N - M O D E L Y F A C T O R Y I N T E R I O R 23 G I G A F A C T O R Y B E R L I N - M O D E L Y F A C T O R Y I N T E R I O R 24 G I G A F A C T O R Y T E X A S 3 months ago Present day Vehicle Deliveries (units) Net Income ($B) K E Y M E T R I C S Q U A R T E R L Y (Unaudited) 25 Operating Cash Flow ($B) Free Cash Flow ($B) 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000 1Q -2 0 18 2 Q -2 0 18 3 Q -2 0 18 4 Q -2 0 18 1Q -2 0 19 2 Q -2 0 19 3 Q -2 0 19 4 Q -2 0 19 1Q -2 0 2 0 2 Q -2 0 2 0 3 Q -2 0 2 0 4 Q -2 0 2 0 -4.0 -3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 4.0 1Q -2 0 18 2 Q -2 0 18 3 Q -2 0 18 4 Q -2 0 18 1Q -2 0 19 2 Q -2 0 19 3 Q -2 0 19 4 Q -2 0 19 1Q -2 0 2 0 2 Q -2 0 2 0 3 Q -2 0 2 0 4 Q -2 0 2 0 -0.8 -0.6 -0.4 -0.2 0.0 0.2 0.4 0.6 0.8 1Q -2 0 18 2 Q -2 0 18 3 Q -2 0 18 4 Q -2 0 18 1Q -2 0 19 2 Q -2 0 19 3 Q -2 0 19 4 Q -2 0 19 1Q -2 0 2 0 2 Q -2 0 2 0 3 Q -2 0 2 0 4 Q -2 0 2 0 K E Y M E T R I C S T R A I L I N G 1 2 M O N T H S ( T T M ) (Unaudited) Vehicle Deliveries (units) Operating Cash Flow ($B) Free Cash Flow ($B) Net Income ($B) 26 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 1Q -2 0 18 2 Q -2 0 18 3 Q -2 0 18 4 Q -2 0 18 1Q -2 0 19 2 Q -2 0 19 3 Q -2 0 19 4 Q -2 0 19 1Q -2 0 2 0 2 Q -2 0 2 0 3 Q -2 0 2 0 4 Q -2 0 2 0 -6.0 -5.0 -4.0 -3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 1Q -2 0 18 2 Q -2 0 18 3 Q -2 0 18 4 Q -2 0 18 1Q -2 0 19 2 Q -2 0 19 3 Q -2 0 19 4 Q -2 0 19 1Q -2 0 2 0 2 Q -2 0 2 0 3 Q -2 0 2 0 4 Q -2 0 2 0 -3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 1Q -2 0 18 2 Q -2 0 18 3 Q -2 0 18 4 Q -2 0 18 1Q -2 0 19 2 Q -2 0 19 3 Q -2 0 19 4 Q -2 0 19 1Q -2 0 2 0 2 Q -2 0 2 0 3 Q -2 0 2 0 4 Q -2 0 2 0 F I N A N C I A L S T A T E M E N T S In millions of USD or shares as applicable, except per share data Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020 REVENUES Automotive sales 6,143 4,893 4,911 7,346 9,034 Automotive leasing 225 239 268 265 280 Total automotive revenue 6,368 5,132 5,179 7,611 9,314 Energy generation and storage 436 293 370 579 752 Services and other 580 560 487 581 678 Total revenues 7,384 5,985 6,036 8,771 10,744 COST OF REVENUES Automotive sales 4,815 3,699 3,714 5,361 6,922 Automotive leasing 119 122 148 145 148 Total automotive cost of revenues 4,934 3,821 3,862 5,506 7,070 Energy generation and storage 385 282 349 558 787 Services and other 674 648 558 644 821 Total cost of revenues 5,993 4,751 4,769 6,708 8,678 Gross profit 1,391 1,234 1,267 2,063 2,066 OPERATING EXPENSES Research and development 345 324 279 366 522 Selling, general and administrative 699 627 661 888 969 Restructuring and other (12) Total operating expenses 1,032 951 940 1,254 1,491 INCOME FROM OPERATIONS 359 283 327 809 575 Interest income 10 10 8 6 6 Interest expense (170) (169) (170) (163) (246) Other (expense) income, net (25) (54) (15) (97) 44 INCOME BEFORE INCOME TAXES 174 70 150 555 379 Provision for income taxes 42 2 21 186 83 NET INCOME 132 68 129 369 296 Net income attributable to noncontrolling interests and redeemable noncontrolling interests 27 52 25 38 26 NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS 105 16 104 331 270 Less: Buy-out of noncontrolling interest 31 NET INCOME USED IN COMPUTING NET INCOME PER SHARE OF COMMON STOCK 105 16 104 300 270 Net income per share of common stock attributable to common stockholders(1) Basic $ 0.12 $ 0.02 $ 0.11 $ 0.32 $ 0.28 Diluted $ 0.11 $ 0.02 $ 0.10 $ 0.27 $ 0.24 Weighted average shares used in computing net income per share of common stock(1) Basic 902 915 928 937 951 Diluted 935 994 1,036 1,105 1,124 S T A T E M E N T O F O P E R A T I O N S (Unaudited) 28 (1)Prior period results have been retroactively adjusted to reflect the five-for-one stock split effected in the form of a stock dividend in August 2020. B A L A N C E S H E E T (Unaudited) In millions of USD 31-Dec-19 31-Mar-20 30-Jun-20 30-Sep-20 31-Dec-20 ASSETS Current assets Cash and cash equivalents 6,268 8,080 8,615 14,531 19,384 Accounts receivable, net 1,324 1,274 1,485 1,757 1,886 Inventory 3,552 4,494 4,018 4,218 4,101 Prepaid expenses and other current assets 959 1,045 1,218 1,238 1,346 Total current assets 12,103 14,893 15,336 21,744 26,717 Operating lease vehicles, net 2,447 2,527 2,524 2,742 3,091 Solar energy systems, net 6,138 6,106 6,069 6,025 5,979 Property, plant and equipment, net 10,396 10,638 11,009 11,848 12,747 Operating lease right-of-use assets 1,218 1,197 1,274 1,375 1,558 Goodwill and intangible assets, net 537 516 508 521 520 Other non-current assets 1,470 1,373 1,415 1,436 1,536 Total assets 34,309 37,250 38,135 45,691 52,148 LIABILITIES AND EQUITY Current liabilities Accounts payable 3,771 3,970 3,638 4,958 6,051 Accrued liabilities and other 3,222 2,825 3,110 3,252 3,855 Deferred revenue 1,163 1,186 1,130 1,258 1,458 Customer deposits 726 788 713 708 752 Current portion of debt and finance leases (1) 1,785 3,217 3,679 3,126 2,132 Total current liabilities 10,667 11,986 12,270 13,302 14,248 Debt and finance leases, net of current portion (1) 11,634 10,666 10,416 10,559 9,556 Deferred revenue, net of current portion 1,207 1,199 1,198 1,233 1,284 Other long-term liabilities 2,691 2,667 2,870 3,049 3,330 Total liabilities 26,199 26,518 26,754 28,143 28,418 Redeemable noncontrolling interests in subsidiaries 643 632 613 608 604 Convertible senior notes 60 44 48 51 Total stockholders' equity 6,618 9,173 9,855 16,031 22,225 Noncontrolling interests in subsidiaries 849 867 869 861 850 Total liabilities and equity 34,309 37,250 38,135 45,691 52,148 (1) Breakdown of our debt is as follows: Vehicle and energy product financing (non-recourse) 4,183 4,022 4,043 4,141 3,930 Other non-recourse debt 355 708 1,415 605 630 Recourse debt 7,263 7,600 7,106 7,448 5,660 Total debt excluding vehicle and energy product financing 7,618 8,308 8,521 8,053 6,290 29 In millions of USD Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020 CASH FLOWS FROM OPERATING ACTIVITIES Net income 132 68 129 369 296 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation, amortization and impairment 577 553 567 584 618 Stock-based compensation 281 211 347 543 633 Other 204 175 167 269 230 Changes in operating assets and liabilities, net of effect of business combinations 231 (1,447) (246) 635 1,242 Net cash provided by (used in) operating activities 1,425 (440) 964 2,400 3,019 CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures (412) (455) (546) (1,005) (1,151) Purchases of solar energy systems, net of sales (37) (26) (20) (16) (13) Purchase of intangible assets (5) (5) Receipt of government grants 46 1 — 122 Business combinations, net of cash acquired (13) Net cash used in investing activities (403) (480) (566) (1,039) (1,047) CASH FLOWS FROM FINANCING ACTIVITIES Net cash flows from debt activities (591) 544 164 (630) (2,074) Collateralized lease repayments (87) (97) (71) (56) (16) Net borrowings (repayments) under vehicle and solar financing 478 (160) 18 99 (215) Net cash flows from noncontrolling interests - Auto 19 (8) (3) (31) 0 Net cash flows from noncontrolling interests - Solar 6 (40) (42) (49) (46) Proceeds from issuances of common stock in public offerings, net of issuance costs 2,309 4,973 4,987 Other 96 160 57 144 56 Net cash (used in) provided by financing activities (79) 2,708 123 4,450 2,692 Effect of exchange rate changes on cash and cash equivalents and restricted cash 14 (24) 38 86 234 Net increase in cash and cash equivalents and restricted cash 957 1,764 559 5,897 4,898 Cash and cash equivalents and restricted cash at beginning of period 5,826 6,783 8,547 9,106 15,003 Cash and cash equivalents and restricted cash at end of period 6,783 8,547 9,106 15,003 19,901 S T A T E M E N T O F C A S H F L O W S (Unaudited) 30 In millions of USD or shares as applicable, except per share data Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020 Net income attributable to common stockholders (GAAP) 105 16 104 331 270 Stock-based compensation expense 281 211 347 543 633 Net income attributable to common stockholders (non-GAAP) 386 227 451 874 903 Less: Buy-out of noncontrolling interest 31 Net income used in computing EPS attributable to common stockholders (non -GAAP) 386 227 451 843 903 EPS attributable to common stockholders, diluted (GAAP) (1) 0.11 0.02 0.10 0.27 0.24 Stock-based compensation expense per share (1) 0.30 0.21 0.34 0.49 0.56 EPS attributable to common stockholders, diluted (non-GAAP) (1) 0.41 0.23 0.44 0.76 0.80 Shares used in EPS calculation, diluted (GAAP and non-GAAP) (1) 935 994 1,036 1,105 1,124 Net income attributable to common stockholders (GAAP) 105 16 104 331 270 Interest expense 170 169 170 163 246 Provision for income taxes 42 2 21 186 83 Depreciation, amortization and impairment 577 553 567 584 618 Stock-based compensation expense 281 211 347 543 633 Adjusted EBITDA (non-GAAP) 1,175 951 1,209 1,807 1,850 Total revenues 7,384 5,985 6,036 8,771 10,744 Adjusted EBITDA margin (non-GAAP)(2) 15.9% 15.9% 20.0% 20.6% 17.2% Automotive gross margin (GAAP) 22.5% 25.5% 25.4% 27.7% 24.1% Less: Total regulatory credit revenue recognized 1.6% 5.5% 6.7% 4.0% 3.4% Automotive gross margin excluding regulatory credits (non-GAAP) 20.9% 20.0% 18.7% 23.7% 20.7% R E C O N C I L I A T I O N O F G A A P T O N O N G A A P F I N A N C I A L I N F O R M A T I O N (Unaudited) 31 In millions of USD 1Q-2018 2Q-2018 3Q-2018 4Q-2018 1Q-2019 2Q-2019 3Q-2019 4Q-2019 1Q-2020 2Q-2020 3Q-2020 4Q-2020 Net cash (used in) provided by operating activities (GAAP) (398) (130) 1,391 1,235 (640) 864 756 1,425 (440) 964 2,400 3,019 Capital expenditures (656) (610) (510) (325) (280) (250) (385) (412) (455) (546) (1,005) (1,151) Free cash flow (non-GAAP) (1,054) (740) 881 910 (920) 614 371 1,013 (895) 418 1,395 1,868 In millions of USD 1Q-2018 2Q-2018 3Q-2018 4Q-2018 1Q-2019 2Q-2019 3Q-2019 4Q-2019 1Q-2020 2Q-2020 3Q-2020 4Q-2020 Net cash (used in) provided by operating activities - TTM (GAAP) (389) (319) 1,373 2,098 1,856 2,850 2,215 2,405 2,605 2,705 4,349 5,943 Capital expenditures TTM (3,518) (3,169) (2,563) (2,101) (1,725) (1,365) (1,240) (1,327) (1,502) (1,798) (2,418) (3,157) Free cash flow - TTM (non-GAAP) (3,907) (3,488) (1,190) (3) 131 1,485 975 1,078 1,103 907 1,931 2,786 (1)Prior period results have been retroactively adjusted to reflect the five-for-one stock split effected in the form of a stock dividend in August 2020. (2) Adjusted EBITDA margin is Adjusted EBITDA as a percentage of total revenues. In millions of USD or shares as applicable, except per share data 2016 2017 2018 2019 2020 Net (loss) income attributable to common stockholders (GAAP) (675) (1,962) (976) (862) 721 Stock-based compensation expense 334 467 749 898 1,734 Net (loss) income attributable to common stockholders (non-GAAP) (341) (1,495) (227) 36 2,455 Less: Buy-out of noncontrolling interest 8 31 Net (loss) income used in computing EPS attributable to common stockholders (non -GAAP) (341) (1,495) (227) 28 2,424 EPS attributable to common stockholders, diluted (GAAP) (1) (0.94) (2.37) (1.14) (0.98) 0.64 Stock-based compensation expense per share (1) 0.47 0.57 0.87 1.01 1.60 EPS attributable to common stockholders, diluted (non-GAAP) (1) (0.47) (1.80) (0.27) 0.03 2.24 Shares used in EPS calculation, diluted (GAAP and non-GAAP) (1) 721 829 853 887 1,083 Net (loss) income attributable to common stockholders (GAAP) (675) (1,962) (976) (862) 721 Interest expense 199 471 663 685 748 Provision for income taxes 27 32 58 110 292 Depreciation, amortization and impairment 947 1,636 1,901 2,154 2,322 Stock-based compensation expense 334 467 749 898 1,734 Adjusted EBITDA (non-GAAP) 832 644 2,395 2,985 5,817 Total revenues 7,000 11,759 21,461 24,578 31,536 Adjusted EBITDA margin (non-GAAP)(2) 11.9% 5.5% 11.2% 12.1% 18.4% Automotive gross margin (GAAP) 25.2% 22.9% 23.4% 21.2% 25.6% Less: Total regulatory credit revenue recognized 3.7% 3.0% 1.7% 2.3% 4.6% Automotive gross margin excluding regulatory credits (non-GAAP) 21.5% 19.9% 21.7% 18.9% 21.0% R E C O N C I L I A T I O N O F G A A P T O N O N G A A P F I N A N C I A L I N F O R M A T I O N (Unaudited) 32 (1)Prior period results have been retroactively adjusted to reflect the five-for-one stock split effected in the form of a stock dividend in August 2020. (2) Adjusted EBITDA margin is Adjusted EBITDA as a percentage of total revenues. A D D I T I O N A L I N F O R M A T I O N WEBCAST INFORMATION Tesla will provide a live webcast of its fourth quarter 2020 financial results conference call beginning at 3:30 p.m. PT on January 27, 2021 at ir.tesla.com. This webcast will also be available for replay for approximately one year thereafter. CERTAIN TERMS When used in this update, certain terms have the following meanings. Our vehicle deliveries include only vehicles that have been transferred to end customers with all paperwork correctly completed. Our energy product deployment volume includes both customer units installed and equipment sales; we report installations at time of commissioning for storage projects or inspection for solar projects, and equipment sales at time of delivery. "Adjusted EBITDA" is equal to (i) net income (loss) attributable to common stockholders before (ii)(a) interest expense, (b) provision for income taxes, (c) depreciation, amortization and impairment and (d) stock-based compensation expense, which is the same measurement for this term pursuant to the performance-based stock option award granted to our CEO in 2018. "Free cash flow" is operating cash flow less capital expenditures. NON-GAAP FINANCIAL INFORMATION Consolidated financial information has been presented in accordance with GAAP as well as on a non-GAAP basis to supplement our consolidated financial results. Our non-GAAP financial measures include non-GAAP automotive gross margin, non-GAAP net income (loss) attributable to common stockholders, non-GAAP net income (loss) attributable to common stockholders on a diluted per share basis (calculated using weighted average shares for GAAP diluted net income (loss) attributable to common stockholders), Adjusted EBITDA, Adjusted EBITDA margin and free cash flow. These non- t is useful to supplement its GAAP financial statements with this non-GAAP information because management uses such information internally for its operating, budgeting and financial planning purposes. Management also believes that presentation of the non-GAAP financial measures provides useful information to our investors regarding our financial condition and results of operations so that investors can see through the eyes of Tesla management regarding important financial metrics that Tesla uses to run the business, and allowing -GAAP information is not prepared under a comprehensive set of accounting rules and therefore, should only be read in conjunction with financial information reported -GAAP financial information is provided above. FORWARD-LOOKING STATEMENTS nt, production capacity and output rates, demand and market growth, deliveries, deployment, range and other features and improvements and timing of existing and future Tesla products and technologies such as Model 3, Model Y, Model S, Model X, Tesla Semi, Autopilot and Full Self Driving software and hardware, our energy storage products, the battery cells we are developing and our manufacturing technologies; statements regarding operating margin, spending and liquidity; and statements regarding construction, expansion, improvements and/or -lookin -looking statements are erially from those projected. The following important factors, without limitation, could cause actual results to differ materially from those in the forward-looking statements: uncertainties in future macroeconomic and regulatory conditions arising from the current global pandemic; the risk of delays in launching and manufacturing our products and features cost-effectively; our ability to grow our sales, delivery, installation, servicing and c generally and our vehicles specifically; the ability of suppliers to deliver components according to schedules, prices, quality and volumes acceptable to us, and our ability to manage such components effectively; any issues with lithium-ion cells or other components manufactured at Gigafactory Nevada; our ability to build and ramp Gigafactory Shanghai, Gigafactory Berlin and Gigafactory Texas in accordance with our plans; our ability to procure supply of battery cells, including through our own manufacturing; risks relating to international expansion; any failures by Tesla products to perform as expected or if product recalls occur; the risk of product liability claims; competition in the automotive and energy product markets; our ability to maintain public credibility and confidence in our long-term business prospects; our ability to manage risks relating to our various product financing programs; the status of government and economic incentives for electric vehicles and energy products; our ability to attract, hire and retain key employees and qualified personnel and ramp our installation teams; our ability to maintain the security of our information and production and product systems; our compliance with various regulations and laws applicable to our operations and products, which may evolve from time to time; risks relating to our indebtedness and financing strategies; and adverse foreign exchange movements. More information on potential factors that could affect our financial results is included from time to time in our Securities and Exchange port on Form 10-Q filed with the SEC on October 26, 2020. Tesla disclaims any obligation to update information contained in these forward-looking statements whether as a result of new information, future events, or otherwise. 33