I love that Tesla is able to pull this kind of revenue lever without discounting cars, channel stuffing, or affecting margins. Pure profit from existing client base. Brilliant.
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Near-future quarterly financial projections
- Thread starter luvb2b
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- elon is an ass
I love that Tesla is able to pull this kind of revenue lever without discounting cars, channel stuffing, or affecting margins. Pure profit from existing client base. Brilliant.
The Accountant
Active Member
Very helpful; this certainly changes things for Q3. Thanks
Did you account for the pretty big change in the dollar-euro exchange rate over the last month or so? It’s a financial positive for Tesla and happened right in time for the bulk of European Q3 deliveries. I remember from recent quarters that Tesla reported positive and negative forex effects in the order of - if my memory serves me well - $30 to $80 million.
Doggydogworld
Active Member
Autopark is where you stop next to the spot then it pulls into it while you keep your foot near the brake in case it starts to mess up. Like Hyundai's "Smaht Pahk".I am guessing this is what they are referring to as Autopark - which is included in EAP (and FSD)
This cuts both ways because the liabilities (e.g. warranty reserve) change along with revenue.
Somewhat of a moot point, considering we only care about gross margin per vehicle, and warranty expense as a % if COGS would not be enormous.
Ultimately, there’s clearly a disproportionate FX benefit given that revenue would be in one currency whereas almost all of the COGS (except warranty reserve and maybe some shipping costs) would be in another.
The Accountant
Active Member
I have not yet factored in the favorable Fx movement in Q3. I will have that in my next update.
Back of the envelope, I estimated about $60m to $80m increase to Revenues. There is a small negative impact on costs.
Offsetting some of this may be another increase to stock based compnesation due to the CEO Award.
I should have another update by tomorrow.
Does this article make sense to anyone?
Tesla (TSLA): Elon Musk says 'record deliveries possible' in leaked employee email - Electrek
I don't understand the following statement from the article "Tesla’s Q3 delivery estimate consensus from Wall Street analysts was 121,000 vehicles as of last week."
121,000 expected delivery is very low; I had thought it would be 140K or higher. According to Yahoo Finance the Expected EPS for Q3 is $0.55/share . 931 million shares x $0.55/share = $0.512 billion
-if ASP is ~ $50K/vehicle: 121,000 x $50k = $6.05 billion in automotive revenue. Base on The Accountant's numbers: (base on 142K delivery): this is a > $900 million short in automotive revenue, and this would translate to a probable LOSS for Q3 (unless there is a whole lot more regulatory credits than expected and/or a whole bunch of people buying the $4K enhanced autopilot). The Wall Street expected delivery is NOT consistent with the expected EPS.
Tesla (TSLA): Elon Musk says 'record deliveries possible' in leaked employee email - Electrek
I don't understand the following statement from the article "Tesla’s Q3 delivery estimate consensus from Wall Street analysts was 121,000 vehicles as of last week."
121,000 expected delivery is very low; I had thought it would be 140K or higher. According to Yahoo Finance the Expected EPS for Q3 is $0.55/share . 931 million shares x $0.55/share = $0.512 billion
-if ASP is ~ $50K/vehicle: 121,000 x $50k = $6.05 billion in automotive revenue. Base on The Accountant's numbers: (base on 142K delivery): this is a > $900 million short in automotive revenue, and this would translate to a probable LOSS for Q3 (unless there is a whole lot more regulatory credits than expected and/or a whole bunch of people buying the $4K enhanced autopilot). The Wall Street expected delivery is NOT consistent with the expected EPS.
The Wall Street consensus has almost never been anywhere close to actuals.
Even this quarter, with more analysts starting to increase price targets and estimates, they are still tracking well behind Tesla’s own ALREADY STATED targets (500k vehicles).
Here is the current FactSet consensus as of 9/20. All metrics are in $ millions except for EPS.
[TD2]
8,429.35
[/TD2]
[TD2]
6,064.29
[/TD2]
[TD2]
1,725.29
[/TD2]
[TD2]
675.144
[/TD2]
[TD2]
324.022
[/TD2]
[TD2]
580.633
[/TD2]
[TD2]
636.398
[/TD2]
[TD2]
438.614
[/TD2]
[TD2]
615.517
[/TD2]
[TD2]
0.388
[/TD2]
[TD2]
0.492
[/TD2]
[TD2]
1,426.87
[/TD2]
[TD2]
760.833
[/TD2]
| Total Revenue |
| COGS |
| Gross Income |
| SG&A |
| R&D |
| Operating Income (GAAP) |
| Operating Income (non-GAAP) |
| Net Income (GAAP) |
| Net Income (non-GAAP) |
| EPS (GAAP) |
| EPS (non-GAAP) |
| Cash Flow from Operations |
| Free Cash Flow |
The Accountant
Active Member
121k deliveries would only get us GAAP income of about $100m and that would be with help from Reg Credits of $230m.
We don't have a full copy of Elon's email but it is possible that it went out to all US based personnel and the record deliveries comment relates to Fremont.
See table below:
Previous record-high Fremont based deliveries were 112k in Q4 2019. I am estimating 106k for Q3 2020.
If Tesla is aiming to break the Fremont based delivery record of 112k, that's bullish.
The Accountant
Active Member
Thanks - this is helpful.
I can see the consensus is low on the CEO Perforamce Award expense. The difference between GAAP and Non GAAP Net Income is not wide enough. The difference should be about $450m at least and they are only showing $176m.
The Accountant
Active Member
Regarding Model Y deliveries to Europe this year, is that just a prediction or did you see that announced?
Tesla "announced it" when they suddenly posted much longer Y lead times consistent with the typical pattern of early quarter production being manufactured for export. They must be wondering why even the numbers people aren't paying attention.
U.S. demand obviously doesn't support selling 40K+ U.S. MY in Q4. The current demand level of about 30K U.S. Consider the uncertainty around pandemic, the election and now winter is coming.
My model Y even came with Euro legal yellow rear turn signals.
In hindsight exporting Y should have been obvious when the cut price by $3K on July 11. No reason to risk making their sales numbers by only selling to North America.
Sounds circumstantial:
They only goes domestic, how can you say what true demand is? Is there a surplus somewhere or is the line being purposely slowed?
Texas is going to build east coast Ys, that also indicates a lack of supply.
Which are also legal in the US (and may become the stanard in the future). What about a rear fog lamp, did it have that?
Or Tesla's ramp went better than expected and they are keeping margins in the 20 something percent range.
Fremont is switching the Y line to the single piece rear casting. This incurs a line shutdown/ slowdown.
They only goes domestic, how can you say what true demand is? Is there a surplus somewhere or is the line being purposely slowed?
Texas is going to build east coast Ys, that also indicates a lack of supply.
Which are also legal in the US (and may become the stanard in the future). What about a rear fog lamp, did it have that?
Or Tesla's ramp went better than expected and they are keeping margins in the 20 something percent range.
I doubt Tesla suddenly starts producing all Y with the rear casting. Most likely the rear casting enables the 7 seater and those vehicles will at first be the ones with the new construction.
The seven seater is the alternate way Tesla could make ~40K U.S. sales in Q4. That's the only demand stimulator they have for the U.S., as they certainly don't want to cut price again. Medium term the Y was well priced at the higher amount IMO. The car is a very good value.
It is very unlikely Tesla is greatly reducing weekly production to transition to the new year casting. They can't increase quarter to quarter production with the line not running. However they transition will involve keeping their monthly production number up.
So are they confident they can make 15K seven seaters in Q4? Or is it safer to sell a bunch of high margin Y in the EU? I think Tesla hates the $3K Y discount. A little U.S. scarcity kills the need for that pricing. After all, worldwide demand for the Y far exceeds supply. It is a fantastic large EV for Europe. Dropping a bunch of Y on VW group just as they launch the ID4 is exactly what Musk would want to do.
The seven seater is the alternate way Tesla could make ~40K U.S. sales in Q4. That's the only demand stimulator they have for the U.S., as they certainly don't want to cut price again. Medium term the Y was well priced at the higher amount IMO. The car is a very good value.
It is very unlikely Tesla is greatly reducing weekly production to transition to the new year casting. They can't increase quarter to quarter production with the line not running. However they transition will involve keeping their monthly production number up.
So are they confident they can make 15K seven seaters in Q4? Or is it safer to sell a bunch of high margin Y in the EU? I think Tesla hates the $3K Y discount. A little U.S. scarcity kills the need for that pricing. After all, worldwide demand for the Y far exceeds supply. It is a fantastic large EV for Europe. Dropping a bunch of Y on VW group just as they launch the ID4 is exactly what Musk would want to do.
Doggydogworld
Active Member
On September 7/8 Model Y wait time went from 2-4 weeks to 10-14 weeks. Mid-Nov to mid-Dec delivery is 100% consistent with shipping to Europe. That was the second signal we had, the first being the Ys spotted on RCC Asia. But then about a week ago Y wait time dropped back to 5-9 weeks (at least in TX). That was mid-Oct to mid-Nov delivery, kind of early if shipping to Europe. S/X wait are 6-10 weeks, even with excess production capacity. Of course "wait time math" involves wide error bands.
I don't really see another explanation for 5-9 weeks, much less the original 10-14 weeks. The "single piece casting" theory doesn't wash - they wouldn't go offline more than a few days for that. Most early September orders are being delivered by EOQ, so there wasn't some huge surge in demand. And they did guide for a large Y production increase right about now.
It's almost a coin flip to me whether the leaked "possible record deliveries" e-mail refers to Fremont only or US/NA only. The 2Q19 leaks specified NA, so I'd lean toward thinking this is global. Even with massive sandbagging that would be really bad news. On the other hand, Shanghai seems to operate with almost 100% autonomy so it's possible the e-mail only applies to Fremont.
They also have the LR-RWD demand lever. Though that's basically a price cut (COGS savings is not that much). Pricing just below 3AWD is a bit messy, too.
I agree. It's good for Tesla margins and helps them defend their position in Europe.
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dc_h
Active Member
Berlin should begin limited production in Q1. I don’t think they’ll export USA models and then switch to made in Germany 2-3 months later. They may limit production as they switch to 1 piece rear assembly, and they may have some additional assembly and design changes planned. 5-9 weeks could just be addition of Canada deliveries, soaking up 2-3 weeks and then 3-4 weeks delivery time for east coast and Midwest. Berlin, according to Elon, is going to be different the the made in America Y and the made in China will also be updated from the Fremont model.
I think the added 7 seat model could be announced after tomorrow and that could add to the wait. Bottom line, the wait could be shifting deliveries to Canada, added shipping times to east and Midwest and new 7 seat. Export to Europe seems very unlikely to me.
I think the added 7 seat model could be announced after tomorrow and that could add to the wait. Bottom line, the wait could be shifting deliveries to Canada, added shipping times to east and Midwest and new 7 seat. Export to Europe seems very unlikely to me.
