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2014 Q2 Prediction Thread
- Thread starter hershey101
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Mario Kadastik
Active Member
The link for Estonia is correct however there is a non-core market fudge factor. Namely the stats are given at end of month status, but Tesla accounts for end of quarter cars paid for in that quarter. As the delivery is at Tilburg, then there is a natural 1 week delay between car sold and car registered in Estonia. In the first week of July there were 4 cars registered in Estonia, that were all paid for in June so the number of cars for Estonia is higher, hence my direct reporting in the EU market situation thread. I guess this is similar in other non-core markets where the official stance is that delivery is at Tilburg and transfer from there to customer is on customers own shoulders (you organize transport though Tesla can help with it). But in any case, the Estonian number has limited impact as it's +- 4-5 cars 
So this fudge factor has to be accounted for in the end of quarter months, the interim months are smaller impact as it doesn't matter much if the car's registered in May or June
So this fudge factor has to be accounted for in the end of quarter months, the interim months are smaller impact as it doesn't matter much if the car's registered in May or June
Chickenlittle
Banned
Severe impact on what? Share price next day? Not very important in long term. Those other factors will be what the share price will be in a qtr or a year
Any missed guidance will have a negative impact but it will be quickly forgotten/absorbed with GF news, information about both production lines running and some comments about China demand.
I do not think that both production lines will be running after the shut-down. To me the two week shut-down is needed to transfer production from the existing line with two shift capability at around 800 cars/week to a new line with production capability of around 1200 cars/week. It is my conjecture that after production shifted to the new line, modifications can be down on the existing line to bring its two shift capability to the same 1200 cars a week...
So I think it will be some time after the shutdown, before both lines are operational.
I don't know. Given the numbers we have from this thread the only realistic way they can miss guidance is for American deliveries to come way below expectations (ie are down instead of up 10% as guided). I think such an event would open up the can of worms of negative speculation on why that may be, something that could take quite a while to shake out of the market. However, I admit speculating on market sentiment always feels like reading the tea leaves.
I wouldn't be so sure. FUD has caused the stock to fall many times before, and there will be a lot of FUD if Tesla delivers 50-100 cars less than guidance. I also doubt margins will increase enough to move the stock, I'm nervous about the Gigafactory because anything that is not "we broke ground already" will cause the stock to fall, and they will probably not release pricing for Model X until they have Production prototypes, etc. There are so many expectations out of the stock right now, the largest of which is groundbreaking of the Gigafactory, which I'm not sure happened because Tesla would have made an announcement.
Nitpicking here, but the shareholder guided orders in the US not deliveries:
"North American net orders grew sequentially by more than 10% in the quarter."
Of COURSE we should try to do our best to predict the sales numbers. It might well be a small part of the overall results, and a small part of the market reception, but it is the part we can try to calculate and put bounds around. Any future knowledge is valuable. And these are really expensive cars, so 50-100 cars is 5 to 10 million in revenue. That is like saying Boeing's results won't be affected they don't sell a few planes.
that's not nit-picky at all; it reiterates a valid point;
Tesla is vastly constrained by production- Guidance is given based on what Tesla feels they can produce/deliver; Has nothing to do with Orders; this is especially acute now with China in the picture- So it's good to point out NA orders growth has no real meaningful correlation to meeting Guidance. If they beat guidance, that points to meaningful progress toward the production goals stated. It's a worthwhile exercise for that important piece; but as long as the ramp up continues on pace or faster, the stock won't react to it imo (unless they lose ground); I see the market looking for other aspects to move the price higher, including GF, ModIII news, ModX news, margins, production guidance, perhaps China delivery successes. - it is worthwhile to at least verify meeting guidance from a production standpoint- which looks to be easily the case so we don't see a big negative driver; but I think current price assumes meeting or slightly exceeding guidance, but does not price in the other aspects we might get. my 2c
Chickenlittle
Banned
Anyone have any idea how Tesla will report their leased cars? In their last shareholder letter they said they expect about 200 leased cars in Q2. It would appear to me that this could hurt their P/L statement since they need to pay for those cars (expenses) yet they won't receive much revenue for those cars (ie., monthly lease payments) until they sell the cars after the lease is over. I'm assuming they will add a page to their shareholder letter to show how they will recoup the "losses" of the 200 leased cars over time, but I imagine there to be a significant hit to GAAP & non-GAAP eps.
My understanding is that they are creating a leasing company but it's a subsidiary of Tesla so Tesla reports all the subsidiary finances as their own.
Other OEMs realize full revenue on their leased vehicles because they sell the cars to dealers. But in Tesla's case they are going to realize revenue over the length of the lease. In other words, it becomes a sort of liability on paper, at least in the short-term (although in the long-term is an asset) since they need to recognize the full expenses of the car yet they don't receive full revenue right away. One way they possibly could do it is to somehow spread out the expenses of the car over the length of the lease. I'm not sure how they'd do it. I'm hoping someone with a business accounting background might chip in and share their thoughts on this.
Here's the snippet from their Q2 2014 Shareholder letter:
"For leased vehicles, we will recognize lease revenue over the term of the lease in both our GAAP and non-GAAP financials. In contrast, automotive OEMs recognize full revenue for the price of the vehicle, even if that vehicle is eventually leased, because the vehicle is first sold to an independent dealer. Therefore, to facilitate comparisons with other automakers, we plan to include a supplemental table in future shareholder letters that summarizes the quarterly aggregate price of vehicles leased to customers."
On a side note, it appears that Tesla is still forecasting a positive non-GAAP eps despite the 200 or so leased cars. From the same shareholder letter:
"Despite the start of leasing vehicles, investments in R&D and geographic expansion, we expect to be marginally profitable in Q2 on a non-GAAP basis."
Other OEMs realize full revenue on their leased vehicles because they sell the cars to dealers. But in Tesla's case they are going to realize revenue over the length of the lease. In other words, it becomes a sort of liability on paper, at least in the short-term (although in the long-term is an asset) since they need to recognize the full expenses of the car yet they don't receive full revenue right away. One way they possibly could do it is to somehow spread out the expenses of the car over the length of the lease. I'm not sure how they'd do it. I'm hoping someone with a business accounting background might chip in and share their thoughts on this.
Here's the snippet from their Q2 2014 Shareholder letter:
"For leased vehicles, we will recognize lease revenue over the term of the lease in both our GAAP and non-GAAP financials. In contrast, automotive OEMs recognize full revenue for the price of the vehicle, even if that vehicle is eventually leased, because the vehicle is first sold to an independent dealer. Therefore, to facilitate comparisons with other automakers, we plan to include a supplemental table in future shareholder letters that summarizes the quarterly aggregate price of vehicles leased to customers."
On a side note, it appears that Tesla is still forecasting a positive non-GAAP eps despite the 200 or so leased cars. From the same shareholder letter:
"Despite the start of leasing vehicles, investments in R&D and geographic expansion, we expect to be marginally profitable in Q2 on a non-GAAP basis."
Absolutely. But that guidance was from Q1 and deliveries follow orders in the US market within one quarter. That is why I feel a 10% increase in deliveries for Q2 in the US market is reasonable.
Muskol
Member
FredTMC
Model S VIN #4925
MartinAustin
Active Member
Wow, nice. This is about the earliest after the quarter that I've seen. Usually it's about another week after this point. They must be speeding up their accounting!
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