Jerome Guillen at TESLIVE

[nygiants242]

Referring to the Julian Cox (banned Seeking Alpha contributor) post on Tesla's official forum:

"Of note in this GS piece is the absence of any short-term
prognosis, specifically any mention of Q2 profit or loss. This is telling when without doubt following the comments let slip by Jerome Guillen at Teslive over the weekend, Tesla will in fact produce a modest profit overturning the analyst-consensus of a small Q2 loss."

What exactly is he referring to? Does anybody here know? Thanks for clarifying.

 

[ggr]

Referring to the Julian Cox (banned Seeking Alpha contributor) post on Tesla's official forum:

"Of note in this GS piece is the absence of any short-term
prognosis, specifically any mention of Q2 profit or loss. This is telling when without doubt following the comments let slip by Jerome Guillen at Teslive over the weekend, Tesla will in fact produce a modest profit overturning the analyst-consensus of a small Q2 loss."


What exactly is he referring to? Does anybody here know? Thanks for clarifying.

Well, I'm pretty sure Jerome didn't say any such thing. In fact, a couple of times he paused and thought about things before answering (or failing to).

 

[roblab]

Well, I'm pretty sure Jerome didn't say any such thing. In fact, a couple of times he paused and thought about things before answering (or failing to).

Could he have said it in a small group conversation? I don't think he was gagged until he went on stage, or that they gagged him as soon as his talk was over. So, I would not be as sure that he didn't say any such thing. He could have.

 

[bonnie]

I am sure that Jerome is well aware of boundaries regarding what he may and may not disclose. No one needed to gag him.

- - - Updated - - -

What I mean is that whatever he may have said in a small group conversation or on stage, was already vetted. If you've ever worked for a public company and you are 'okayed to talk publicly', you are well-rehearsed by the lawyers. ... Or you're Elon Musk.

 

[PeterW]

I am sure that Jerome is well aware of boundaries regarding what he may and may not disclose. No one needed to gag him.

- - - Updated - - -

What I mean is that whatever he may have said in a small group conversation or on stage, was already vetted. If you've ever worked for a public company and you are 'okayed to talk publicly', you are well-rehearsed by the lawyers. ... Or you're Elon Musk.

LOL

 

[ModelS8794]

Referring to the Julian Cox (banned Seeking Alpha contributor) post on Tesla's official forum:

"Of note in this GS piece is the absence of any short-term
prognosis, specifically any mention of Q2 profit or loss. This is telling when without doubt following the comments let slip by Jerome Guillen at Teslive over the weekend, Tesla will in fact produce a modest profit overturning the analyst-consensus of a small Q2 loss."

.
What exactly is he referring to? Does anybody here know? Thanks for clarifying.

During Jerome's Q&A (2:10:50), he made mention that tesla was operating at "razor thin margins" in the 2Q and that's why they were so intent on expediting delivery of loaner cars that had been purchased, even without a steady supply of replacement loaners in the pipeline.

I don't find that comment dispositive, but it may be the exchange this Julian cox fellow was referring to with his conclusions about modest profitability in the Q.

 

[vgrinshpun]

During Jerome's Q&A (2:10:50), he made mention that tesla was operating at "razor thin margins" in the 2Q and that's why they were so intent on expediting delivery of loaner cars that had been purchased, even without a steady supply of replacement loaners in the pipeline.

I don't find that comment dispositive, but it may be the exchange this Julian cox fellow was referring to with his conclusions about modest profitability in the Q.

I Was going to post the same thing, but you beat me to it.

 

[SteveG3]

makes sense S8794

 

[Doug_G]

During Jerome's Q&A (2:10:50), he made mention that tesla was operating at "razor thin margins" in the 2Q and that's why they were so intent on expediting delivery of loaner cars that had been purchased, even without a steady supply of replacement loaners in the pipeline.

I don't find that comment dispositive, but it may be the exchange this Julian cox fellow was referring to with his conclusions about modest profitability in the Q.

That's sneaky - he's reading between the lines and trying to get Jerome in trouble in the process.

 

[djp]

That's sneaky - he's reading between the lines and trying to get Jerome in trouble in the process.

Agreed, that's a stretch. "Razor thin margins" doesn't mean they're profitable bottom line. We already know the production margins are above zero but below the target of 25%.

 

[nygiants242]

Agreed, that's a stretch. "Razor thin margins" doesn't mean they're profitable bottom line. We already know the production margins are above zero but below the target of 25%.

But the thing is, what were margins at last quarter? and what are they projected to be this quarter? Isn't it in the double digits for sure? (10%+?) I wouldn't exactly call that "razor thin". What if he is actually referring to profit margin?

 

[ggr]

Could he have said it in a small group conversation? I don't think he was gagged until he went on stage, or that they gagged him as soon as his talk was over. So, I would not be as sure that he didn't say any such thing. He could have.

Much of the time before he went on stage he was sitting next to me. But he did leave his seat for a while, so I can't say about that.

 

[sleepyhead]

But the thing is, what were margins at last quarter? and what are they projected to be this quarter? Isn't it in the double digits for sure? (10%+?) I wouldn't exactly call that "razor thin". What if he is actually referring to profit margin?

Probably NET profit margin, since 10% - 25% gross profit margin would not be "razor thin." If you are making $500m in sales and your net profit is aound break even, then this would be considered "razor thin." A few additional sales of loaner cars can make a huge difference if you are operating on razor thin net profit margins. With every additional product sold your net profit margin will improve as well since most of the operating costs are fixed.

 

[ckessel]

Probably NET profit margin, since 10% - 25% gross profit margin would not be "razor thin." If you are making $500m in sales and your net profit is aound break even, then this would be considered "razor thin." A few additional sales of loaner cars can make a huge difference if you are operating on razor thin net profit margins. With every additional product sold your net profit margin will improve as well since most of the operating costs are fixed.

Remember also that Jerome (if he said anything at all) may have been speaking in terms of cash flow and non-GAAP. The GAAP earnings will have to account for hoops related to recognizing revenue from leases.

 

[Discoducky]

During Jerome's Q&A (2:10:50), he made mention that tesla was operating at "razor thin margins" in the 2Q and that's why they were so intent on expediting delivery of loaner cars that had been purchased, even without a steady supply of replacement loaners in the pipeline.

I don't find that comment dispositive, but it may be the exchange this Julian cox fellow was referring to with his conclusions about modest profitability in the Q.

He's commenting about service profit margins which is supposed to operate this way.

 

[maekuz]

Probably NET profit margin, since 10% - 25% gross profit margin would not be "razor thin." If you are making $500m in sales and your net profit is aound break even, then this would be considered "razor thin." A few additional sales of loaner cars can make a huge difference if you are operating on razor thin net profit margins. With every additional product sold your net profit margin will improve as well since most of the operating costs are fixed.

I just watched the video: I think he meant net profit because he says something along the lines of "when you need to get profitable..." and then trails off to end the sentence with some other thought. Kudos to Julian Cox for finding that.

- - - Updated - - -

He's commenting about service profit margins which is supposed to operate this way.

He says: "If you want to prosper we need to get profitable and therefore...if that car is sold...we will...we try to give it to the person who buys it as soon as possible"

I think he is talking about the net profit.

 

[clmason]

Two possibilities to consider. One that accounting has not been completed and the books are not closed on the quarter.. The results may not be known yet. Two that Jerome's may not be privy to all the accounting data just yet...

 

[Discoducky]

I just watched the video: I think he meant net profit because he says something along the lines of "when you need to get profitable..." and then trails off to end the sentence with some other thought. Kudos to Julian Cox for finding that.

- - - Updated - - -



He says: "If you want to prosper we need to get profitable and therefore...if that car is sold...we will...we try to give it to the person who buys it as soon as possible"

I think he is talking about the net profit.

He is talking about loaner cars at service centers. That was the question he is answering.

 

[sleepyhead]

He is talking about loaner cars at service centers. That was the question he is answering.

Let me paraphrase this for you, and somebody please correct me if I am wrong:

Q: Why do you guys keep selling the loaner cars instead of keeping them so that I can get one (instead of an ICE) if I need to use the service center.

A (Jerome): Because we at Tesla are trying to get profitable and during the quarter we are running very close to break even net profit. If we have somebody willing to pay us cash for a top of the line loaner car then we are going to sell it as fast as the buyer can fork over the money. Every car like this is a high margin vehicle and will greatly help us reach our goal of being profitable in Q2.

 

[maekuz]

Every car like this is a high margin vehicle and will greatly help us reach our goal of being profitable in Q2.

Exactly!