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Jerome Guillen at TESLIVE
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This is an accurate statement. Julian Cox likes to over-read in between the lines. I saw him post before that the VIN's are indicating Q2 deliveries of 6,750 to 10,000.
Unless the ZEV credit has gone down more than 50%, I can't envision a scenario where Tesla would not be profitable on a non-GAAP basis. I am fairly certain that they will be profitable on non-GAAP. There is even a chance for profitability on a GAAP basis as well if everything went right.
To me this seems at odds with what Elon has said in the past about not doing things to boost the stock price in the short term at the expense of the long term.
djp
Model 3 Performance
Good summary sleepyhead. I'm the one who asked the question and I had the same understanding.
I don't agree with Julian's interpretation, there isn't any material non-public information in Jerome's comments. All he said is that margins are tight and they're trying to become profitable which is no different than past guidance.
A profit in Q2 would be best for the stock and company in the long run. What Elon meant is that they could build 10,000 cars in Q2 if they wanted to because the demand is there and they could work 3 shifts if they really wanted to. This would boost the stock price immensely in the short run at the expense of the long-run.
Don't ever mistake that just because they are scrambling to exceed Q2 estimates/guidance that they are not thinking about the long run. This is the reason why SpaceX will not go public in the next few years.
Agreed with this as well. Unfortunately as a public company you have to balance the interest of the shareholders as well as customers. And in order to keep your cost of capital low you have to, among other things, make sure that your stock price is strong and stable.
Also if Tesla misses earnings and the stock price craters 50% then you will have a lot of people cancelling their reservations fearing that the company may not survive. It is definitely a delicate balancing act.
Jonathan Hewitt
Active Member
It may sound silly but this was part of my initial metric for investing in the company back in January. I figured that I could put some money in TSLA and see what happens after a few years. If the stock price went up, great, I would be able to pay for the car with my profits. If it didn't go up or the company went bankrupt, well, it's probably because the car wasn't as good as I thought and it's good I didn't buy a car! I don't think I'd apply that logic to the company today but I'm sure there's others that would.
Thank you, Julian, for your thorough analysis. Your research is truly excellent and much appreciated. Welcome to the Tesla Motors Club; I hope you become a regular. BTW, I've also had trouble with Seeking Alpha, so I empathize.
I apologize for a minor nitpick regarding the sentence I quoted which brings up a common misperception. On Tuesday Tesla announced that earnings will be reported on August 7. The company made no previous announcement of a date, not even hints. The last earnings report was on May 8; August 7 fits the pattern. However entities that are out of the loop regularly feel compelled to provide estimates of companies' reporting dates. The guesses they make for Tesla have generally been for dates far too early. A misunderstanding of this process has led to numerous conjectures about the reason for Tesla "pushing back" its reporting date, when in fact there has been no delay.
Mike C, Jack thanks. Regards WH timing, I have no way of knowing, not even an average response time would be useful as this will be a non-issue if it gets an average response. If i was Elon I would ask Dairmuid to camp on the WH lawn with a team of lawyers until the Administration had a well informed course of action to announce. Don't think this is pivotal to the short term, it's just great icing on the cake if it goes really well.
Alpha gratitude (with mild overtones of embarrassment), bonnie agreed.
Alpha gratitude (with mild overtones of embarrassment), bonnie agreed.
I would like to add a voice to say that this thread is about Jerome and an a resulting analysis of Tesla. I am very grateful for the support but whatever merit I have comes from from a track record of insights in to concerns that bigger than myself, the effect of which can only be harmed by handing over the keys to the FUD artists to dismiss every word I say as self promotion.
So ok, back on topic... Someone just posted on SA (of all places 
) interesting find on Q2 profitability...
Elon has been quoted as saying he will publish his ideas about the Hyperloop after 2 consecutive profitable quarters. Current average estimates for this quarter are -0.16c and the Hyperloop goes public 16 August. Tesla reports results 6 August, very convenient timing and potentially another short squeeze.
) interesting find on Q2 profitability...Elon has been quoted as saying he will publish his ideas about the Hyperloop after 2 consecutive profitable quarters. Current average estimates for this quarter are -0.16c and the Hyperloop goes public 16 August. Tesla reports results 6 August, very convenient timing and potentially another short squeeze.
So ok, back on topic... Someone just posted on SA (of all places
Elon has been quoted as saying he will publish his ideas about the Hyperloop after 2 consecutive profitable quarters. Current average estimates for this quarter are -0.16c and the Hyperloop goes public 16 August. Tesla reports results 6 August, very convenient timing and potentially another short squeeze.
I think that even this positive find must be taken with a grain of salt, as it's been clear that the media and others have been prodding Elon to publish more info about the hyperloop, so he may be doing it earlier than he originally thought he would (i.e. before 2 solid earnings quarters.)
But it's equally probable that Q2 will in fact beat expectations and will in fact be profitable (that's my opinion as a consummate bull...)
I don't recall reading/watching Elon mentioning 2 positive quarters before Hyperloop unveiling. All I remember him mentioning at Khan Academy was he will release Hyperloop details only after 1st Q positive earnings. If anyone knows, please share.
I expect Tesla to break-even barely. It is the hike in yearly volume & Q3 numbers which will trigger stock to go up -IMHO.
I expect Tesla to break-even barely. It is the hike in yearly volume & Q3 numbers which will trigger stock to go up -IMHO.
Went through the 1st Q/A about hyperloop. He mentioned he'll talk about it sometimes after the last tesla announcement (6/20). Its fun to mix & match what he says and try to get clue from what he does as he's generally right about most of the things. Well, this time, I am sure its not 2nd profit that he said.
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