2017 Q3 ER- Predictions and thoughts

[luvb2b]

@SBenson: i suspect street gaap estimates have some zev revenue in them.

a difference of 9c on the non-gaap estimates is only $15m. maybe the street didn't count the one-time solarcity fine, or maybe the one-time solarcity fine will get non-gaap'd. if they non-gaap the fine that would make the total gaap/non-gaap reconciliation in my model 95c and bring my non-gaap to -2.10. i'll try to post something later which includes some non-gaap estimation.

great comments everyone thank you.

I'm using a pro-tool (PM for details), I see GAAP consensus of -2.74; non-gaap -2.21
Revenue of 2.91B

 

[kenliles]

maybe the street didn't count the one-time solarcity fine

Given the timing this has been my suspicion. I didn’t see any change in street on this fairly recent event and have doubts it was encorporated, especially for nonG.

 

[luvb2b]

How can Model 3 have 22% gross margin at 3,000/w when EM himself guided a full quarter after reaching 5,000/w is when it may get to 25%?!

At 3,000/week, which is my 1Q18 assumption, I have Model 3 at 10% gross margin, 15% in 2Q18, 20% in 3Q18, 22% in 4Q18, and never 25%.

so my understanding was that if it takes a lot of overtime to get to 5k/weekly then the it would take time to get to 25% at that rate. in the q2 letter they mention:

Additionally, during the initial phase of the Model 3 ramp in Q3, the volume produced will be tiny relative to the installed production capacity. As a result, Model 3 gross margin in Q3 will be temporarily impacted by the excessive allocation of labor and overhead costs and depreciation over this tiny volume. In the absence of these one-time elevated cost allocations, Model 3 gross margin in Q3 would already be positive, resulting in a positive cash contribution. ​

based on limited available information, i had tried to rough out what the relatively fixed overhead and depreciation costs would be, and what the incremental cost per vehicle would be. using an overly simplified linear model

model 3 cogs = m * (number of units) + b

i estimated b at $125 million and m at a high end of $40k per vehicle.

if those are satisfactory, plug in 39,000 units into the formula (3k per week * 13 weeks) to get an estimate of cost of goods sold. take the revenue as 39,000 * $50,000 and you should find gross margin around 13.6%.

then there's the autopilot, at $5k/each with a take rate of 70%, it adds an approx. 7% to the gross margins. so that's close to 21% gross margin. that's a rough sketch of how i got there, some other adjustments here and there. you could argue the case that the avg. selling price won't be 50k but on the early units i felt it would be.

 

[ValueAnalyst]

i have a somewhat complicated leasing model, but the explanation is twofold:
a. in the prior period an unusually high portion of deferred revenue was realized (in my modeling), and i am normalizing that a bit this quarter towards historical norms.
b. i estimate about 7.5m less in resale value guarantee expirations (which are additive to lease revenue).

on dollar weakness, it's a combination of what i have observed by studying swings in other income vs. the us dollar index and the explanation in the 10k (p48):

Other income (expense), net, consists primarily of foreign exchange gains and losses related to our foreign currency-denominated assets and liabilities. We expect our foreign exchange gains and losses will vary depending upon movements in the underlying exchange rates.​

Forex is a very complex issue but on net weaker dollar should net benefit Tesla since it's a net exporter.

so my understanding was that if it takes a lot of overtime to get to 5k/weekly then the it would take time to get to 25% at that rate. in the q2 letter they mention:

Additionally, during the initial phase of the Model 3 ramp in Q3, the volume produced will be tiny relative to the installed production capacity. As a result, Model 3 gross margin in Q3 will be temporarily impacted by the excessive allocation of labor and overhead costs and depreciation over this tiny volume. In the absence of these one-time elevated cost allocations, Model 3 gross margin in Q3 would already be positive, resulting in a positive cash contribution. ​

based on limited available information, i had tried to rough out what the relatively fixed overhead and depreciation costs would be, and what the incremental cost per vehicle would be. using an overly simplified linear model

model 3 cogs = m * (number of units) + b

i estimated b at $125 million and m at a high end of $40k per vehicle.

if those are satisfactory, plug in 39,000 units into the formula (3k per week * 13 weeks) to get an estimate of cost of goods sold. take the revenue as 39,000 * $50,000 and you should find gross margin around 13.6%.

then there's the autopilot, at $5k/each with a take rate of 70%, it adds an approx. 7% to the gross margins. so that's close to 21% gross margin. that's a rough sketch of how i got there, some other adjustments here and there. you could argue the case that the avg. selling price won't be 50k but on the early units i felt it would be.

I'd agree with ASP and marginal cost assumptions. I think your estimate of take rate on EAP is high and $125m estimate may be low.

 

[luvb2b]

there are 2 problems with the naive estimate here:

a. the q2 number includes 100m zev credits. so to do the crude math, he should take the zev credits out of q2.
b. not all of 4000 cars sold go to the bottom line due to leasing. so the adjustment would be slightly less than 0.4b (i assume he took 4000 cars x 100k per car).

but yes, crudely take: 2.79b q2 revenue - 100m zev credits + 4000 vehicles * 80% not leased * 100k per car = 3.01b which is higher than street estimates.

Trader myhedghog, who follows Option Sniper, and is a TSLA bull, is expecting the stock to turn around with the ER this week based upon a revenue beat. May not be worth much but provides an outside perspective. No other details to his analysis than this:

View attachment 256944

 

[luvb2b]

how being an exporter affects valuation of assets and liabilities (balance sheet items) is not something i understand, so let's agree to disagree. eap take rate had been revealed somewhere for s/x in the high 70s/low 80s. the early 3's should have similar customer preferences so 70% seems ok to me. let's agree to disagree, as i tend to disagree with much of what you write.

Forex is a very complex issue but on net weaker dollar should net benefit Tesla since it's a net exporter.



I'd agree with ASP and marginal cost assumptions. I think your estimate of take rate on EAP is high and $125m estimate may be low.

 

[ValueAnalyst]

how being an exporter affects valuation of assets and liabilities (balance sheet items) is not something i understand, so let's agree to disagree. eap take rate had been revealed somewhere for s/x in the high 70s/low 80s. the early 3's should have similar customer preferences so 70% seems ok to me. let's agree to disagree, as i tend to disagree with much of what you write.

I can help with this. The change in translated values of ex-US subsidiary balance sheet items are reflected in OCI on consolidated balance sheet, but weak dollar helps net exporters on income statement by increasing the dollar value of ex-US revenue. I think what you're seeing in other income may be changes in hedges. Tesla's financials are also a bit more confusimg because of batteries imported from Japan.

I think 70% may prove optimistic given the slower than expected improvement in EAP and more price sensitive nature of Model 3 buyers vs. S/X.

Not sure why you had to include the last bit, but okay.

 

[geneclean55]

No one is perfect. luvb2b did a great job back in 2013. Not so much for q12017.

 

[kenliles]

Let’s reset expectations a bit. Calling results of ER and any other predictive efforts are essentially an impossible task to accomplish - that’s even true for the CEO/CFO of the company, which almost always project the wrong results for given quarters.

Anyone putting themselves out there with their volunteered best efforts for the benefit of all of us, deserves our grateful thanks and respect.

All of these efforts have value and provide reference frames for all of us to make investment decisions, whether proven right or wrong.

I would caution, too much conclusory opinions based on pure accuracy of any model or prediction.

Some examples to point out include luvb2b recent insightful evaluation of short activity relative to local SP bottoming and perhaps its subsequent effects. His detailed ER model just provided here provide an entire framework of discussion and comparison for every other expectation on this board.

We would have less information about all views without that reference for discussion- regardless of right or wrong. In fact, we all know, we are ALL both right and wrong about virtually every event prediction, much less an ER result of a company like TSLA.
Even, disagreement across diverse approaches provides much value, again regardless of right or wrong;

So far I haven’t seen anyone else put out a full model and result. Anyone? If you have such to share, then share it and expose you’re own vulnerability to right or wrong. Otherwise be grateful for those willing to do so, and move on.

k-

 

[SBenson]

I don’t think this ER, SP reaction will be about Q3 financials at all. It will be all about state of M3 ramp and guidance of it for Q4.

Generally Tesla doesn’t guide next year in Q3 ER, it does so in Q4 ER. So much of next year stuff will be qualitative discussion and EMs speculative chat.

So the really important piece of info will be about M3 Q4 and much of SP reaction will be directly bound to it IMO.

 

[luvb2b]

as i am studying the non-gaap/gaap eps issue: although gross margins get non-gaap'd with stock-based comp and zev revenue taken out, the bottom line eps is non-gaap'd a different way.

for bottom line eps the methodology has shifted over the last 5-6 quarters, but the recent approach is start with net income take out stock based comp. and one-time gains/expenses (like those related to solarcity acquisition). i would lean towards taking out the solarcity fine in non-gaap numbers this time around.

i made some further corrections / adjustments to my model as follows:
1. added non-gaap reconciliation section, see below -2.19 for non-gaap eps and -3.09 for gaap eps. that will be the worst in the last 7 quarters, at least.
2. i was mistakenly assuming some model 3's were leased, i believe they are all sales with no leases for now. this has the effect of bringing up model 3 revenue and gross margin. model 3 asp i adjusted slightly higher realizing i forgot to include options like autopilot and paint etc. model 3 gross margin i set to maintain total auto gross margin at 20% while assuming s/x gross margin of 25%.
3. speaking of s/x gross margin, that was guided lower in the last letter. but i think with higher production comes greater efficiency and so am favoring a slight uptick there taking midpoint of q3 2016 and q1 2017 gross margin (when production was around 25k units s/x).
4. i had the wrong share count, they had 167m shares going into the quarter and this reduces the loss per share.
5. i thought about r&d a bit after some comments and decided it was prudent to adjust it higher - for example they had to pay grohmann employees more. note that i try to estimate a split of tesla/scty r&d so those looking for full company r&d / sg&a should add those respective line items.
6. there's some downside risk from higher opex. they guided "essentially flat", but that could mean up 3%, which makes a meaningful difference to the bottom line number.

here's the full update.

…

ls veh % total

avg price s+x

avg price model 3

revenue

auto sales ex 3

auto sales mod 3

auto leasing

1 time autopilot

zev credits

total auto

energy storage

solarcity

grohmann

services/other

total revenue

cost of revenue

auto sales ex 3

auto sales mod 3

auto leasing

total auto

energy storage

solarcity

grohmann

services & other

total cost of rev

gross profit

auto gaap ex 3 gm

auto-zev ex 3 gm

model 3 gm

auto-zev incl 3 gm

storage gm

scty gm

grohmann gm

services gm

opex

tesla r&d

tesla sg&a

1time acq cost

solarcity r&d

solarcity sg&a

total opex

op income

interest inc

interest exp

scty interest

other income exp

1time scty gain

pretax income

income tax

net income

non-cont int.

net inc to common

basic shares

diluted shares

diluted gaap eps

gaap net income

- stock based comp

- one time scty

non-gaap net income

non-gaap diluted eps

[TD2] luv q3-17 [/TD2][TD2] Jun-17 [/TD2][TD2] Mar-17 [/TD2][TD2] Sep-16 [/TD2] [TD2] 0.21 [/TD2][TD2] 0.19 [/TD2][TD2] 0.26 [/TD2][TD2] 0.32 [/TD2] [TD2] 108.00 [/TD2][TD2] 107.27 [/TD2][TD2] 108.06 [/TD2][TD2] 105.40 [/TD2] [TD2] 53.00 [/TD2][TD2] 0.00 [/TD2][TD2] 0.00 [/TD2][TD2] 0.00 [/TD2] [TD2]2,212,348[/TD2][TD2]1,913,852[/TD2][TD2]2,000,060[/TD2][TD2]1,778,901[/TD2] [TD2]11,660[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]253,395[/TD2][TD2]272,764[/TD2][TD2]254,540[/TD2][TD2]231,285[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]35,000[/TD2][TD2]0[/TD2] [TD2]0[/TD2][TD2]100,000[/TD2][TD2]0[/TD2][TD2]138,541[/TD2] [TD2] 2,477,403 [/TD2][TD2] 2,286,616 [/TD2][TD2] 2,289,600 [/TD2][TD2] 2,148,727 [/TD2] [TD2]35,000[/TD2][TD2]15,680[/TD2][TD2]5,244[/TD2][TD2]23,334[/TD2] [TD2]285,000[/TD2][TD2]271,100[/TD2][TD2]208,700[/TD2][TD2]0[/TD2] [TD2]5,100[/TD2][TD2]10,200[/TD2][TD2]22,400[/TD2][TD2]0[/TD2] [TD2]230,000[/TD2][TD2]205,961[/TD2][TD2]170,326[/TD2][TD2]126,375[/TD2] [TD2] 3,032,503 [/TD2][TD2] 2,789,557 [/TD2][TD2] 2,696,270 [/TD2][TD2] 2,298,436 [/TD2] [TD2]1,686,317[/TD2][TD2]1,472,578[/TD2][TD2]1,496,649[/TD2][TD2]1,355,102[/TD2] [TD2]132,924[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]162,990[/TD2][TD2]175,433[/TD2][TD2]166,026[/TD2][TD2]161,959[/TD2] [TD2] 1,982,231 [/TD2][TD2] 1,648,011 [/TD2][TD2] 1,662,675 [/TD2][TD2] 1,517,061 [/TD2] [TD2]36,750[/TD2][TD2]19,414[/TD2][TD2]6,473[/TD2][TD2]24,281[/TD2] [TD2]199,500[/TD2][TD2]184,348[/TD2][TD2]145,300[/TD2][TD2]0[/TD2] [TD2]3,825[/TD2][TD2]7,600[/TD2][TD2]14,900[/TD2][TD2]0[/TD2] [TD2]287,500[/TD2][TD2]263,569[/TD2][TD2]198,976[/TD2][TD2]120,359[/TD2] [TD2] 2,509,806 [/TD2][TD2] 2,122,942 [/TD2][TD2] 2,028,324 [/TD2][TD2] 1,661,701 [/TD2] [TD2] 522,697 [/TD2][TD2] 666,615 [/TD2][TD2] 667,946 [/TD2][TD2] 636,735 [/TD2] [TD2]25.0%[/TD2][TD2]27.9%[/TD2][TD2]27.4%[/TD2][TD2]29.4%[/TD2] [TD2]25.0%[/TD2][TD2]24.6%[/TD2][TD2]26.3%[/TD2][TD2]24.5%[/TD2] [TD2]-1040.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2] [TD2]20.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2] [TD2]-5.0%[/TD2][TD2]-23.8%[/TD2][TD2]-23.4%[/TD2][TD2]-4.1%[/TD2] [TD2]30.0%[/TD2][TD2]32.0%[/TD2][TD2]30.4%[/TD2][TD2]0.0%[/TD2] [TD2]25.0%[/TD2][TD2]25.5%[/TD2][TD2]33.5%[/TD2][TD2]0.0%[/TD2] [TD2]-25.0%[/TD2][TD2]-28.0%[/TD2][TD2]-16.8%[/TD2][TD2]4.8%[/TD2] [TD2]270,000[/TD2][TD2]324,774[/TD2][TD2]239,070[/TD2][TD2]214,302[/TD2] [TD2]470,000[/TD2][TD2]407,757[/TD2][TD2]446,637[/TD2][TD2]336,811[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]67,000[/TD2][TD2]0[/TD2] [TD2]30,000[/TD2][TD2]45,000[/TD2][TD2]44,800[/TD2][TD2]0[/TD2] [TD2]145,000[/TD2][TD2]130,000[/TD2][TD2]127,988[/TD2][TD2]0[/TD2] [TD2] 915,000 [/TD2][TD2] 907,531 [/TD2][TD2] 925,495 [/TD2][TD2] 551,113 [/TD2] [TD2] -392,303 [/TD2][TD2] -240,916 [/TD2][TD2] -257,549 [/TD2][TD2] 85,622 [/TD2] [TD2]6,000[/TD2][TD2]4,785[/TD2][TD2]3,090[/TD2][TD2]2,858[/TD2] [TD2]-65,000[/TD2][TD2]-54,441[/TD2][TD2]-46,146[/TD2][TD2]-46,713[/TD2] [TD2]-54,000[/TD2][TD2]-54,000[/TD2][TD2]-53,200[/TD2][TD2]0[/TD2] [TD2]-12,000[/TD2][TD2]-41,208[/TD2][TD2]-18,098[/TD2][TD2]-11,756[/TD2] [TD2]-29,500[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2] -546,803 [/TD2][TD2] -385,780 [/TD2][TD2] -371,903 [/TD2][TD2] 30,011 [/TD2] [TD2]20,000[/TD2][TD2]15,647[/TD2][TD2]25,278[/TD2][TD2]8,133[/TD2] [TD2] -566,803 [/TD2][TD2] -401,427 [/TD2][TD2] -397,181 [/TD2][TD2] 21,878 [/TD2] [TD2]-50,000[/TD2][TD2]-65,030[/TD2][TD2]-66,904[/TD2][TD2]0[/TD2] [TD2] -516,803 [/TD2][TD2] -336,397 [/TD2][TD2] -330,277 [/TD2][TD2] 21,878 [/TD2] [TD2]167,500[/TD2][TD2]165,212[/TD2][TD2]162,129[/TD2][TD2]148,991[/TD2] [TD2]167,500[/TD2][TD2]165,212[/TD2][TD2]162,129[/TD2][TD2]156,935[/TD2] [TD2] -3.09 [/TD2][TD2] -2.04 [/TD2][TD2] -2.04 [/TD2][TD2] 0.14 [/TD2] [TD2]-516,803[/TD2][TD2]-336,397[/TD2][TD2]-330,277[/TD2][TD2]21,878[/TD2] [TD2]120,000[/TD2][TD2]116,042[/TD2][TD2]103,717[/TD2][TD2]89,543[/TD2] [TD2]29,500[/TD2][TD2]0[/TD2][TD2]11,571[/TD2][TD2]0[/TD2] [TD2]-367,303[/TD2][TD2]-220,355[/TD2][TD2]-214,989[/TD2][TD2]111,421[/TD2] [TD2] -2.19 [/TD2][TD2] -1.33 [/TD2][TD2] -1.33 [/TD2][TD2] 0.71 [/TD2]

@SBenson: i suspect street gaap estimates have some zev revenue in them.

a difference of 9c on the non-gaap estimates is only $15m. maybe the street didn't count the one-time solarcity fine, or maybe the one-time solarcity fine will get non-gaap'd. if they non-gaap the fine that would make the total gaap/non-gaap reconciliation in my model 95c and bring my non-gaap to -2.10. i'll try to post something later which includes some non-gaap estimation.

great comments everyone thank you.

 

[brian45011]

Not sure when this settlement expense will be accrued under GAAP, and whether it will show up in SG&A or Other Income (Expense)

SolarCity TCPA Settlement - Home

Unlikely in 3Q17, even though the liability has been quantified between the litigants. ( But it would be nice on a "kitchen sink" basis, since the bottom line is going to be ugly, regardless)

Perhaps in 4Q17 because the Class Period ends 10/16/17.

Probably in 1Q18 because the Final Approval hearing is 1/18/18.

 

[neroden]

Let’s reset expectations a bit. Calling results of ER and any other predictive efforts are essentially an impossible task to accomplish - that’s even true for the CEO/CFO of the company, which almost always project the wrong results for given quarters.

This is why I always act as the "Voice of Uncertainty" in these matters reminding people that there's a large error bar on our guesses!

Some examples to point out include luvb2b recent insightful evaluation of short activity relative to local SP bottoming and perhaps its subsequent effects. His detailed ER model just provided here provide an entire framework of discussion and comparison for every other expectation on this board.

I do appreciate luvb2b's work.

I should note that predicting Q1 2018 results (to be reported in early May) will be much more difficult than usual: in addition to the usual unpredictable changes within the company, the entire revenue recognition model changes for that quarter. I am going to go out on a limb right now and predict that it will be a "positive surprise" to Wall Street because I believe the new revenue recognition model tends to, on net, accelerate revenue recognition for Tesla's business lines. But I could be wrong.

It gets even crazier for Q1 2019 (reported in May of that year) when lease accounting changes.

 

[Out4aDuck]

Note that ZEV credits are not subtracted out of non-GAAP earnings. ZEV is subtracted out for the calculation of non-GAAP gross margin, but not earnings.

The only item subtracted out in last quarter's non-GAAP earnings was stock-based compensation expense. It amounted to $116M, or 71 cents/share.

 

[luvb2b]

@neroden: how does the revenue recognition model change q1 2018? do you have a link to that effect?

I should note that predicting Q1 2018 results (to be reported in early May) will be much more difficult than usual: in addition to the usual unpredictable changes within the company, the entire revenue recognition model changes for that quarter.

 

[brian45011]

…

ls veh % total

avg price s+x

avg price model 3

revenue

auto sales ex 3

auto sales mod 3

auto leasing

1 time autopilot

zev credits

total auto

energy storage

solarcity

grohmann

services/other

total revenue

cost of revenue

auto sales ex 3

auto sales mod 3

auto leasing

total auto

energy storage

solarcity

grohmann

services & other

total cost of rev

gross profit

auto gaap ex 3 gm

auto-zev ex 3 gm

model 3 gm

auto-zev incl 3 gm

storage gm

scty gm

grohmann gm

services gm

opex

tesla r&d

tesla sg&a

1time acq cost

solarcity r&d

solarcity sg&a

total opex

op income

interest inc

interest exp

scty interest

other income exp

1time scty gain

pretax income

income tax

net income

non-cont int.

net inc to common

basic shares

diluted shares

diluted gaap eps

gaap net income

- stock based comp

- one time scty

non-gaap net income

non-gaap diluted eps

[TD2] luv q3-17 [/TD2][TD2] Jun-17 [/TD2][TD2] Mar-17 [/TD2][TD2] Sep-16 [/TD2] [TD2] 0.21 [/TD2][TD2] 0.19 [/TD2][TD2] 0.26 [/TD2][TD2] 0.32 [/TD2] [TD2] 108.00 [/TD2][TD2] 107.27 [/TD2][TD2] 108.06 [/TD2][TD2] 105.40 [/TD2] [TD2] 53.00 [/TD2][TD2] 0.00 [/TD2][TD2] 0.00 [/TD2][TD2] 0.00 [/TD2] [TD2]2,212,348[/TD2][TD2]1,913,852[/TD2][TD2]2,000,060[/TD2][TD2]1,778,901[/TD2] [TD2]11,660[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]253,395[/TD2][TD2]272,764[/TD2][TD2]254,540[/TD2][TD2]231,285[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]35,000[/TD2][TD2]0[/TD2] [TD2]0[/TD2][TD2]100,000[/TD2][TD2]0[/TD2][TD2]138,541[/TD2] [TD2] 2,477,403 [/TD2][TD2] 2,286,616 [/TD2][TD2] 2,289,600 [/TD2][TD2] 2,148,727 [/TD2] [TD2]35,000[/TD2][TD2]15,680[/TD2][TD2]5,244[/TD2][TD2]23,334[/TD2] [TD2]285,000[/TD2][TD2]271,100[/TD2][TD2]208,700[/TD2][TD2]0[/TD2] [TD2]5,100[/TD2][TD2]10,200[/TD2][TD2]22,400[/TD2][TD2]0[/TD2] [TD2]230,000[/TD2][TD2]205,961[/TD2][TD2]170,326[/TD2][TD2]126,375[/TD2] [TD2] 3,032,503 [/TD2][TD2] 2,789,557 [/TD2][TD2] 2,696,270 [/TD2][TD2] 2,298,436 [/TD2] [TD2]1,686,317[/TD2][TD2]1,472,578[/TD2][TD2]1,496,649[/TD2][TD2]1,355,102[/TD2] [TD2]132,924[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]162,990[/TD2][TD2]175,433[/TD2][TD2]166,026[/TD2][TD2]161,959[/TD2] [TD2] 1,982,231 [/TD2][TD2] 1,648,011 [/TD2][TD2] 1,662,675 [/TD2][TD2] 1,517,061 [/TD2] [TD2]36,750[/TD2][TD2]19,414[/TD2][TD2]6,473[/TD2][TD2]24,281[/TD2] [TD2]199,500[/TD2][TD2]184,348[/TD2][TD2]145,300[/TD2][TD2]0[/TD2] [TD2]3,825[/TD2][TD2]7,600[/TD2][TD2]14,900[/TD2][TD2]0[/TD2] [TD2]287,500[/TD2][TD2]263,569[/TD2][TD2]198,976[/TD2][TD2]120,359[/TD2] [TD2] 2,509,806 [/TD2][TD2] 2,122,942 [/TD2][TD2] 2,028,324 [/TD2][TD2] 1,661,701 [/TD2] [TD2] 522,697 [/TD2][TD2] 666,615 [/TD2][TD2] 667,946 [/TD2][TD2] 636,735 [/TD2] [TD2]25.0%[/TD2][TD2]27.9%[/TD2][TD2]27.4%[/TD2][TD2]29.4%[/TD2] [TD2]25.0%[/TD2][TD2]24.6%[/TD2][TD2]26.3%[/TD2][TD2]24.5%[/TD2] [TD2]-1040.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2] [TD2]20.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2] [TD2]-5.0%[/TD2][TD2]-23.8%[/TD2][TD2]-23.4%[/TD2][TD2]-4.1%[/TD2] [TD2]30.0%[/TD2][TD2]32.0%[/TD2][TD2]30.4%[/TD2][TD2]0.0%[/TD2] [TD2]25.0%[/TD2][TD2]25.5%[/TD2][TD2]33.5%[/TD2][TD2]0.0%[/TD2] [TD2]-25.0%[/TD2][TD2]-28.0%[/TD2][TD2]-16.8%[/TD2][TD2]4.8%[/TD2] [TD2]270,000[/TD2][TD2]324,774[/TD2][TD2]239,070[/TD2][TD2]214,302[/TD2] [TD2]470,000[/TD2][TD2]407,757[/TD2][TD2]446,637[/TD2][TD2]336,811[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]67,000[/TD2][TD2]0[/TD2] [TD2]30,000[/TD2][TD2]45,000[/TD2][TD2]44,800[/TD2][TD2]0[/TD2] [TD2]145,000[/TD2][TD2]130,000[/TD2][TD2]127,988[/TD2][TD2]0[/TD2] [TD2] 915,000 [/TD2][TD2] 907,531 [/TD2][TD2] 925,495 [/TD2][TD2] 551,113 [/TD2] [TD2] -392,303 [/TD2][TD2] -240,916 [/TD2][TD2] -257,549 [/TD2][TD2] 85,622 [/TD2] [TD2]6,000[/TD2][TD2]4,785[/TD2][TD2]3,090[/TD2][TD2]2,858[/TD2] [TD2]-65,000[/TD2][TD2]-54,441[/TD2][TD2]-46,146[/TD2][TD2]-46,713[/TD2] [TD2]-54,000[/TD2][TD2]-54,000[/TD2][TD2]-53,200[/TD2][TD2]0[/TD2] [TD2]-12,000[/TD2][TD2]-41,208[/TD2][TD2]-18,098[/TD2][TD2]-11,756[/TD2] [TD2]-29,500[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2] -546,803 [/TD2][TD2] -385,780 [/TD2][TD2] -371,903 [/TD2][TD2] 30,011 [/TD2] [TD2]20,000[/TD2][TD2]15,647[/TD2][TD2]25,278[/TD2][TD2]8,133[/TD2] [TD2] -566,803 [/TD2][TD2] -401,427 [/TD2][TD2] -397,181 [/TD2][TD2] 21,878 [/TD2] [TD2]-50,000[/TD2][TD2]-65,030[/TD2][TD2]-66,904[/TD2][TD2]0[/TD2] [TD2] -516,803 [/TD2][TD2] -336,397 [/TD2][TD2] -330,277 [/TD2][TD2] 21,878 [/TD2] [TD2]167,500[/TD2][TD2]165,212[/TD2][TD2]162,129[/TD2][TD2]148,991[/TD2] [TD2]167,500[/TD2][TD2]165,212[/TD2][TD2]162,129[/TD2][TD2]156,935[/TD2] [TD2] -3.09 [/TD2][TD2] -2.04 [/TD2][TD2] -2.04 [/TD2][TD2] 0.14 [/TD2] [TD2]-516,803[/TD2][TD2]-336,397[/TD2][TD2]-330,277[/TD2][TD2]21,878[/TD2] [TD2]120,000[/TD2][TD2]116,042[/TD2][TD2]103,717[/TD2][TD2]89,543[/TD2] [TD2]29,500[/TD2][TD2]0[/TD2][TD2]11,571[/TD2][TD2]0[/TD2] [TD2]-367,303[/TD2][TD2]-220,355[/TD2][TD2]-214,989[/TD2][TD2]111,421[/TD2] [TD2] -2.19 [/TD2][TD2] -1.33 [/TD2][TD2] -1.33 [/TD2][TD2] 0.71 [/TD2]

For comparison with an SA version:

 

[dalalsid]

as i am studying the non-gaap/gaap eps issue: although gross margins get non-gaap'd with stock-based comp and zev revenue taken out, the bottom line eps is non-gaap'd a different way.

for bottom line eps the methodology has shifted over the last 5-6 quarters, but the recent approach is start with net income take out stock based comp. and one-time gains/expenses (like those related to solarcity acquisition). i would lean towards taking out the solarcity fine in non-gaap numbers this time around.

i made some further corrections / adjustments to my model as follows:
1. added non-gaap reconciliation section, see below -2.19 for non-gaap eps and -3.09 for gaap eps. that will be the worst in the last 7 quarters, at least.
2. i was mistakenly assuming some model 3's were leased, i believe they are all sales with no leases for now. this has the effect of bringing up model 3 revenue and gross margin. model 3 asp i adjusted slightly higher realizing i forgot to include options like autopilot and paint etc. model 3 gross margin i set to maintain total auto gross margin at 20% while assuming s/x gross margin of 25%.
3. speaking of s/x gross margin, that was guided lower in the last letter. but i think with higher production comes greater efficiency and so am favoring a slight uptick there taking midpoint of q3 2016 and q1 2017 gross margin (when production was around 25k units s/x).
4. i had the wrong share count, they had 167m shares going into the quarter and this reduces the loss per share.
5. i thought about r&d a bit after some comments and decided it was prudent to adjust it higher - for example they had to pay grohmann employees more. note that i try to estimate a split of tesla/scty r&d so those looking for full company r&d / sg&a should add those respective line items.
6. there's some downside risk from higher opex. they guided "essentially flat", but that could mean up 3%, which makes a meaningful difference to the bottom line number.

here's the full update.

…

ls veh % total

avg price s+x

avg price model 3

revenue

auto sales ex 3

auto sales mod 3

auto leasing

1 time autopilot

zev credits

total auto

energy storage

solarcity

grohmann

services/other

total revenue

cost of revenue

auto sales ex 3

auto sales mod 3

auto leasing

total auto

energy storage

solarcity

grohmann

services & other

total cost of rev

gross profit

auto gaap ex 3 gm

auto-zev ex 3 gm

model 3 gm

auto-zev incl 3 gm

storage gm

scty gm

grohmann gm

services gm

opex

tesla r&d

tesla sg&a

1time acq cost

solarcity r&d

solarcity sg&a

total opex

op income

interest inc

interest exp

scty interest

other income exp

1time scty gain

pretax income

income tax

net income

non-cont int.

net inc to common

basic shares

diluted shares

diluted gaap eps

gaap net income

- stock based comp

- one time scty

non-gaap net income

non-gaap diluted eps

[TD2] luv q3-17 [/TD2][TD2] Jun-17 [/TD2][TD2] Mar-17 [/TD2][TD2] Sep-16 [/TD2] [TD2] 0.21 [/TD2][TD2] 0.19 [/TD2][TD2] 0.26 [/TD2][TD2] 0.32 [/TD2] [TD2] 108.00 [/TD2][TD2] 107.27 [/TD2][TD2] 108.06 [/TD2][TD2] 105.40 [/TD2] [TD2] 53.00 [/TD2][TD2] 0.00 [/TD2][TD2] 0.00 [/TD2][TD2] 0.00 [/TD2] [TD2]2,212,348[/TD2][TD2]1,913,852[/TD2][TD2]2,000,060[/TD2][TD2]1,778,901[/TD2] [TD2]11,660[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]253,395[/TD2][TD2]272,764[/TD2][TD2]254,540[/TD2][TD2]231,285[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]35,000[/TD2][TD2]0[/TD2] [TD2]0[/TD2][TD2]100,000[/TD2][TD2]0[/TD2][TD2]138,541[/TD2] [TD2] 2,477,403 [/TD2][TD2] 2,286,616 [/TD2][TD2] 2,289,600 [/TD2][TD2] 2,148,727 [/TD2] [TD2]35,000[/TD2][TD2]15,680[/TD2][TD2]5,244[/TD2][TD2]23,334[/TD2] [TD2]285,000[/TD2][TD2]271,100[/TD2][TD2]208,700[/TD2][TD2]0[/TD2] [TD2]5,100[/TD2][TD2]10,200[/TD2][TD2]22,400[/TD2][TD2]0[/TD2] [TD2]230,000[/TD2][TD2]205,961[/TD2][TD2]170,326[/TD2][TD2]126,375[/TD2] [TD2] 3,032,503 [/TD2][TD2] 2,789,557 [/TD2][TD2] 2,696,270 [/TD2][TD2] 2,298,436 [/TD2] [TD2]1,686,317[/TD2][TD2]1,472,578[/TD2][TD2]1,496,649[/TD2][TD2]1,355,102[/TD2] [TD2]132,924[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]162,990[/TD2][TD2]175,433[/TD2][TD2]166,026[/TD2][TD2]161,959[/TD2] [TD2] 1,982,231 [/TD2][TD2] 1,648,011 [/TD2][TD2] 1,662,675 [/TD2][TD2] 1,517,061 [/TD2] [TD2]36,750[/TD2][TD2]19,414[/TD2][TD2]6,473[/TD2][TD2]24,281[/TD2] [TD2]199,500[/TD2][TD2]184,348[/TD2][TD2]145,300[/TD2][TD2]0[/TD2] [TD2]3,825[/TD2][TD2]7,600[/TD2][TD2]14,900[/TD2][TD2]0[/TD2] [TD2]287,500[/TD2][TD2]263,569[/TD2][TD2]198,976[/TD2][TD2]120,359[/TD2] [TD2] 2,509,806 [/TD2][TD2] 2,122,942 [/TD2][TD2] 2,028,324 [/TD2][TD2] 1,661,701 [/TD2] [TD2] 522,697 [/TD2][TD2] 666,615 [/TD2][TD2] 667,946 [/TD2][TD2] 636,735 [/TD2] [TD2]25.0%[/TD2][TD2]27.9%[/TD2][TD2]27.4%[/TD2][TD2]29.4%[/TD2] [TD2]25.0%[/TD2][TD2]24.6%[/TD2][TD2]26.3%[/TD2][TD2]24.5%[/TD2] [TD2]-1040.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2] [TD2]20.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2][TD2]0.0%[/TD2] [TD2]-5.0%[/TD2][TD2]-23.8%[/TD2][TD2]-23.4%[/TD2][TD2]-4.1%[/TD2] [TD2]30.0%[/TD2][TD2]32.0%[/TD2][TD2]30.4%[/TD2][TD2]0.0%[/TD2] [TD2]25.0%[/TD2][TD2]25.5%[/TD2][TD2]33.5%[/TD2][TD2]0.0%[/TD2] [TD2]-25.0%[/TD2][TD2]-28.0%[/TD2][TD2]-16.8%[/TD2][TD2]4.8%[/TD2] [TD2]270,000[/TD2][TD2]324,774[/TD2][TD2]239,070[/TD2][TD2]214,302[/TD2] [TD2]470,000[/TD2][TD2]407,757[/TD2][TD2]446,637[/TD2][TD2]336,811[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]67,000[/TD2][TD2]0[/TD2] [TD2]30,000[/TD2][TD2]45,000[/TD2][TD2]44,800[/TD2][TD2]0[/TD2] [TD2]145,000[/TD2][TD2]130,000[/TD2][TD2]127,988[/TD2][TD2]0[/TD2] [TD2] 915,000 [/TD2][TD2] 907,531 [/TD2][TD2] 925,495 [/TD2][TD2] 551,113 [/TD2] [TD2] -392,303 [/TD2][TD2] -240,916 [/TD2][TD2] -257,549 [/TD2][TD2] 85,622 [/TD2] [TD2]6,000[/TD2][TD2]4,785[/TD2][TD2]3,090[/TD2][TD2]2,858[/TD2] [TD2]-65,000[/TD2][TD2]-54,441[/TD2][TD2]-46,146[/TD2][TD2]-46,713[/TD2] [TD2]-54,000[/TD2][TD2]-54,000[/TD2][TD2]-53,200[/TD2][TD2]0[/TD2] [TD2]-12,000[/TD2][TD2]-41,208[/TD2][TD2]-18,098[/TD2][TD2]-11,756[/TD2] [TD2]-29,500[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2] -546,803 [/TD2][TD2] -385,780 [/TD2][TD2] -371,903 [/TD2][TD2] 30,011 [/TD2] [TD2]20,000[/TD2][TD2]15,647[/TD2][TD2]25,278[/TD2][TD2]8,133[/TD2] [TD2] -566,803 [/TD2][TD2] -401,427 [/TD2][TD2] -397,181 [/TD2][TD2] 21,878 [/TD2] [TD2]-50,000[/TD2][TD2]-65,030[/TD2][TD2]-66,904[/TD2][TD2]0[/TD2] [TD2] -516,803 [/TD2][TD2] -336,397 [/TD2][TD2] -330,277 [/TD2][TD2] 21,878 [/TD2] [TD2]167,500[/TD2][TD2]165,212[/TD2][TD2]162,129[/TD2][TD2]148,991[/TD2] [TD2]167,500[/TD2][TD2]165,212[/TD2][TD2]162,129[/TD2][TD2]156,935[/TD2] [TD2] -3.09 [/TD2][TD2] -2.04 [/TD2][TD2] -2.04 [/TD2][TD2] 0.14 [/TD2] [TD2]-516,803[/TD2][TD2]-336,397[/TD2][TD2]-330,277[/TD2][TD2]21,878[/TD2] [TD2]120,000[/TD2][TD2]116,042[/TD2][TD2]103,717[/TD2][TD2]89,543[/TD2] [TD2]29,500[/TD2][TD2]0[/TD2][TD2]11,571[/TD2][TD2]0[/TD2] [TD2]-367,303[/TD2][TD2]-220,355[/TD2][TD2]-214,989[/TD2][TD2]111,421[/TD2] [TD2] -2.19 [/TD2][TD2] -1.33 [/TD2][TD2] -1.33 [/TD2][TD2] 0.71 [/TD2]

For comparison with an SA version:

both are so close

 

[TMSE]

For comparison with an SA version:

What is SA?

 

[EinSV]

What is SA?

Seeking Aclue

 

[30seconds]

as i am studying the non-gaap/gaap eps issue: although gross margins get non-gaap'd with stock-based comp and zev revenue taken out, the bottom line eps is non-gaap'd a different way.

Why do you have automotive revenue decreasing vs. Q1 and Q2?