[deleted]
Q2 2020 Update
31–40 of 302 posts
Re: Q2 2020 Update
#32Earlier quoted context omitted.
They're investing aggressively in new factories and new product lines. If they wanted to show profits today they could give up building and expanding factories and stop entering new product categories. But that would be stupid.
The parent commenter was discussing revenue and not profit. If they were aggressively expanding, I would expect that profits to remain small or negative, but I'd expect revenue to grow as a result.
Yea, if they are adding product lines without an increase in revenue that seems (possibly) concerning, though obviously the current economic situation makes it hard to know how to value year over year comparisons.
Re: Q2 2020 Update
#33So many red flags Profit is all regulatory credits, actual auto sales flat to down, accounts receivable balance is now 1.4B or >20% of revenue, interest income is $8M (down -20%) even though global interest rates were cut to near 0 in Q2, R&D and service spending down despite dozens of projects the company claims to be working on.
On a TTM basis, GAAP OI is $1.23 billion against regulatory credits of $1.05 billion. They are actually barely profitable without the credits (though negative in the current quarter).
Edit: re receivables, I don't necessary see a problem there - DSO of about 21 days - especially considering they also have all the residential receivables from their solar business.
Re: Q2 2020 Update
#34The difference in the narrative versus the financial data is stark: Quarterly revenue has not shown any growth for nearly 2 years, despite introducing more models and expanding global deliveries. Their sales of regulatory credits this year is greater than all of the net income ever earned in their entire history.
They're investing aggressively in new factories and new product lines. If they wanted to show profits today they could give up building and expanding factories and stop entering new product categories. But that would be stupid.
OP referenced revenue growth, not margin expansion. All else equal, you'd expect to see existing products take share and generate movement on the top-line.
Though it could be the case that their investment in new product development reduces their ability to meet current demand and therein throttles revenue; not sure if the 10Q references their order backlog.
Re: Q2 2020 Update
#35What are regulatory credits? I thought the 7500 credit ran out?
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Re: Q2 2020 Update
#36Earlier quoted context omitted.
They're investing aggressively in new factories and new product lines. If they wanted to show profits today they could give up building and expanding factories and stop entering new product categories. But that would be stupid.
The parent commenter was discussing revenue and not profit. If they were aggressively expanding, I would expect that profits to remain small or negative, but I'd expect revenue to grow as a result.
Just to make it more clear what bqe is saying: they are selling the ~same amount of cars as 2 years ago. Both in terms of $ and in terms of #. Growth is completely flat.
Re: Q2 2020 Update
#37The difference in the narrative versus the financial data is stark: Quarterly revenue has not shown any growth for nearly 2 years, despite introducing more models and expanding global deliveries. Their sales of regulatory credits this year is greater than all of the net income ever earned in their entire history.
Tesla posted positive free cash flow (CFO - capex) for 4 of the last 5 quarters (page 24) and it the only company with increase in # of deliveries among the 10 largest autos globally (page 7). Gross margins >20% is also best in class in the auto industry The list goes on in terms of growth & profitability
Off of credits though right? Also isn’t Tesla considered a “tech” stock by a lot of investors? A 20% gross margin is not good for a tech stock.
Re: Q2 2020 Update
#38The difference in the narrative versus the financial data is stark: Quarterly revenue has not shown any growth for nearly 2 years, despite introducing more models and expanding global deliveries. Their sales of regulatory credits this year is greater than all of the net income ever earned in their entire history.
Tesla posted positive free cash flow (CFO - capex) for 4 of the last 5 quarters (page 24) and it the only company with increase in # of deliveries among the 10 largest autos globally (page 7). Gross margins >20% is also best in class in the auto industry The list goes on in terms of growth & profitability
they earn 100% margins on selling $400M in mysterious regulatory credits
Re: Q2 2020 Update
#39The difference in the narrative versus the financial data is stark: Quarterly revenue has not shown any growth for nearly 2 years, despite introducing more models and expanding global deliveries. Their sales of regulatory credits this year is greater than all of the net income ever earned in their entire history.
When almost ever other car company is burning money, sustaining massive investment in multiple new massive factories, launching new products, and producing cars with pretty good margin and not losing money is an pretty big accomplishment. Its not that long ago people were arguing even a small crisis would wipe out Tesla.
>producing cars with pretty good margin and not losing money is an pretty big accomplishment.
If you back out the regulatory credits they've lost money on every car they've ever sold, for almost 20 years. Where do you get "good margins" from?
This is an example of narrative versus financial data.
Re: Q2 2020 Update
#40Earlier quoted context omitted.
Tesla posted positive free cash flow (CFO - capex) for 4 of the last 5 quarters (page 24) and it the only company with increase in # of deliveries among the 10 largest autos globally (page 7). Gross margins >20% is also best in class in the auto industry The list goes on in terms of growth & profitability
Off of credits though right? Also isn’t Tesla considered a “tech” stock by a lot of investors? A 20% gross margin is not good for a tech stock.
“Regulatory credits” are getting paid for making electric cars other automakers won’t make.
Fiat alone must pay Tesla $2B for credits to keep selling internal combustion vehicles in Europe.