yes correct. i've updated my model incorporating the latest sales estimates and adding in some units for canada. it may be a bit surprising that i'm taking down earnings slightly, but it's mostly because i think 27k units of s/x reaches a bit high due to china tariffs impacting demand in china by 20-30%. an extra ~2k units of model 3 at lower prices help offset. lower asp was taken on model 3 as we've now got 32-33k units that are running 56-57k asp (including non-zev credits). accounting for higher asp's on the september deliveries will still make it hard to lift the quarterly asp by more than 2k.
just a couple key details: cash from operations coming in at 1.08b is probably going to be a bit low. they beat my view on cash generation from ops last time and there is potential upside this quarter as well. i've taken a conservative view to zev credits inserting only 100m but a number like 200m is well within reason. they're selling so many cars now they should just blast out the credits as they have them vs. holding and holding. model 3 gm has upside as well b/c i feel they'll be delivering p's and awd's for more of the later units. there's further upside depending on take rates for autopilot trials and possible revenue recognition of additional eap or fsd features. s/x units may have upside too as i see tesla pulling some demand levers in the usa and because we are on a record pace for the us and eu through the first 2 quarters. there may be negative surprises in opex and services again as i'm quite suspicious some expense shifting is boosting model 3 gross margin while raising loss in services and opex.
two additional lines for @Fact Checking on inventory and payables.
[TD2] luv q4-18e [/TD2][TD2] luv q3-18e [/TD2][TD2] Jun-18 [/TD2][TD2] Mar-18 [/TD2] [TD2]15,000[/TD2][TD2]13,400[/TD2][TD2]10,939[/TD2][TD2]11,738[/TD2] [TD2]13,000[/TD2][TD2]13,000[/TD2][TD2]11,380[/TD2][TD2]10,077[/TD2] [TD2] 28,000 [/TD2][TD2] 26,400 [/TD2][TD2] 22,319 [/TD2][TD2] 21,815 [/TD2] [TD2] 60,000 [/TD2][TD2] 51,800 [/TD2][TD2] 18,449 [/TD2][TD2] 8,182 [/TD2] [TD2] 103.00 [/TD2][TD2] 104.00 [/TD2][TD2] 105.14 [/TD2][TD2] 105.42 [/TD2] [TD2] 58.00 [/TD2][TD2] 59.00 [/TD2][TD2] 55.80 [/TD2][TD2] 56.80 [/TD2] [TD2]2,682,120[/TD2][TD2]2,553,408[/TD2][TD2]2,088,411[/TD2][TD2]2,046,829[/TD2] [TD2]3,480,000[/TD2][TD2]3,056,200[/TD2][TD2]1,029,454[/TD2][TD2]464,738[/TD2] [TD2]197,206[/TD2][TD2]200,737[/TD2][TD2]239,816[/TD2][TD2]173,436[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]100,000[/TD2][TD2]100,000[/TD2][TD2]0[/TD2][TD2]50,314[/TD2] [TD2] 6,459,326 [/TD2][TD2] 5,910,345 [/TD2][TD2] 3,357,681 [/TD2][TD2] 2,735,317 [/TD2] [TD2]185,500[/TD2][TD2]140,450[/TD2][TD2]111,651[/TD2][TD2]185,022[/TD2] [TD2]237,600[/TD2][TD2]231,000[/TD2][TD2]262,757[/TD2][TD2]225,000[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]300,000[/TD2][TD2]300,000[/TD2][TD2]270,142[/TD2][TD2]263,412[/TD2] [TD2] 7,182,426 [/TD2][TD2] 6,581,795 [/TD2][TD2] 4,002,231 [/TD2][TD2] 3,408,751 [/TD2] [TD2]1,979,640[/TD2][TD2]1,886,069[/TD2][TD2]1,546,610[/TD2][TD2]1,517,446[/TD2] [TD2]2,714,400[/TD2][TD2]2,567,208[/TD2][TD2]983,129[/TD2][TD2]573,951[/TD2] [TD2]122,268[/TD2][TD2]124,457[/TD2][TD2]136,915[/TD2][TD2]104,496[/TD2] [TD2] 4,816,308 [/TD2][TD2] 4,577,734 [/TD2][TD2] 2,666,654 [/TD2][TD2] 2,195,893 [/TD2] [TD2]185,500[/TD2][TD2]147,473[/TD2][TD2]146,343[/TD2][TD2]217,863[/TD2] [TD2]166,320[/TD2][TD2]161,700[/TD2][TD2]183,930[/TD2][TD2]157,500[/TD2] [TD2]10,999[/TD2][TD2]10,999[/TD2][TD2]11,000[/TD2][TD2]11,000[/TD2] [TD2]375,000[/TD2][TD2]384,000[/TD2][TD2]375,374[/TD2][TD2]369,969[/TD2] [TD2] 5,554,127 [/TD2][TD2] 5,281,906 [/TD2][TD2] 3,383,301 [/TD2][TD2] 2,952,225 [/TD2] [TD2] 1,628,299 [/TD2][TD2] 1,299,890 [/TD2][TD2] 618,930 [/TD2][TD2] 456,526 [/TD2] [TD2]29.5%[/TD2][TD2]29.6%[/TD2][TD2]27.7%[/TD2][TD2]28.6%[/TD2] [TD2]27.0%[/TD2][TD2]27.0%[/TD2][TD2]27.7%[/TD2][TD2]26.9%[/TD2] [TD2]22.0%[/TD2][TD2]16.0%[/TD2][TD2]4.5%[/TD2][TD2]-23.5%[/TD2] [TD2]24.3%[/TD2][TD2]21.2%[/TD2][TD2]20.6%[/TD2][TD2]18.2%[/TD2] [TD2]0.0%[/TD2][TD2]-5.0%[/TD2][TD2]-31.1%[/TD2][TD2]-17.7%[/TD2] [TD2]30.0%[/TD2][TD2]30.0%[/TD2][TD2]30.0%[/TD2][TD2]30.0%[/TD2] [TD2]-100.0%[/TD2][TD2]-100.0%[/TD2][TD2]-100.0%[/TD2][TD2]-100.0%[/TD2] [TD2]-25.0%[/TD2][TD2]-28.0%[/TD2][TD2]-39.0%[/TD2][TD2]-40.5%[/TD2] [TD2]360,000[/TD2][TD2]350,000[/TD2][TD2]341,129[/TD2][TD2]322,096[/TD2] [TD2]630,000[/TD2][TD2]620,000[/TD2][TD2]610,759[/TD2][TD2]551,404[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]103,434[/TD2][TD2]0[/TD2] [TD2]50,000[/TD2][TD2]45,000[/TD2][TD2]45,000[/TD2][TD2]45,000[/TD2] [TD2]145,000[/TD2][TD2]140,000[/TD2][TD2]140,000[/TD2][TD2]135,000[/TD2] [TD2] 1,185,000 [/TD2][TD2] 1,155,000 [/TD2][TD2] 1,240,322 [/TD2][TD2] 1,053,500 [/TD2] [TD2] 443,299 [/TD2][TD2] 144,890 [/TD2][TD2] -621,392 [/TD2][TD2] -596,974 [/TD2] [TD2]6,000[/TD2][TD2]6,000[/TD2][TD2]5,064[/TD2][TD2]5,214[/TD2] [TD2]-107,000[/TD2][TD2]-107,000[/TD2][TD2]-110,582[/TD2][TD2]-102,546[/TD2] [TD2]-53,000[/TD2][TD2]-53,000[/TD2][TD2]-53,000[/TD2][TD2]-47,000[/TD2] [TD2]-12,000[/TD2][TD2]-12,000[/TD2][TD2]50,911[/TD2][TD2]-37,716[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2] 277,299 [/TD2][TD2] -21,110 [/TD2][TD2] -728,999 [/TD2][TD2] -779,022 [/TD2] [TD2]19,999[/TD2][TD2]19,999[/TD2][TD2]13,707[/TD2][TD2]5,605[/TD2] [TD2] 257,300 [/TD2][TD2] -41,109 [/TD2][TD2] -742,706 [/TD2][TD2] -784,627 [/TD2] [TD2]-50,001[/TD2][TD2]-50,001[/TD2][TD2]-25,167[/TD2][TD2]-75,076[/TD2] [TD2] 307,301 [/TD2][TD2] 8,892 [/TD2][TD2] -717,539 [/TD2][TD2] -709,551 [/TD2] [TD2]172,000[/TD2][TD2]170,900[/TD2][TD2]169,997[/TD2][TD2]169,146[/TD2] [TD2]183,000[/TD2][TD2]181,900[/TD2][TD2]169,997[/TD2][TD2]169,146[/TD2] [TD2] 1.68 [/TD2][TD2] 0.05 [/TD2][TD2] -4.22 [/TD2][TD2] -4.19 [/TD2] [TD2]307,301[/TD2][TD2]8,892[/TD2][TD2]-717,539[/TD2][TD2]-709,551[/TD2] [TD2]208,000[/TD2][TD2]200,000[/TD2][TD2]197,344[/TD2][TD2]141,639[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]515,301[/TD2][TD2]208,892[/TD2][TD2]-520,195[/TD2][TD2]-567,912[/TD2] [TD2] 2.82 [/TD2][TD2] 1.15 [/TD2][TD2] -3.06 [/TD2][TD2] -3.36 [/TD2] [TD2] 72.00 [/TD2][TD2] 80.00 [/TD2][TD2] 89.67 [/TD2][TD2] 79.31 [/TD2] [TD2] 77.00 [/TD2][TD2] 81.00 [/TD2][TD2] 81.73 [/TD2][TD2] 80.47 [/TD2] [TD2]3,472,984[/TD2][TD2]2,931,922[/TD2][TD2]2,236,424[/TD2][TD2]2,665,673[/TD2] [TD2]150,000[/TD2][TD2]130,000[/TD2][TD2]146,822[/TD2][TD2]120,194[/TD2] [TD2]1,180,673[/TD2][TD2]1,081,939[/TD2][TD2]569,874[/TD2][TD2]652,848[/TD2] [TD2]4,382,435[/TD2][TD2]4,630,712[/TD2][TD2]3,324,643[/TD2][TD2]2,565,826[/TD2] [TD2]374,443[/TD2][TD2]364,418[/TD2][TD2]422,034[/TD2][TD2]379,379[/TD2] [TD2] 9,560,534 [/TD2][TD2] 9,138,992 [/TD2][TD2] 6,699,797 [/TD2][TD2] 6,383,920 [/TD2] [TD2]2,206,183[/TD2][TD2]2,243,816[/TD2][TD2]2,282,047[/TD2][TD2]2,315,124[/TD2] [TD2]6,333,264[/TD2][TD2]6,336,631[/TD2][TD2]6,340,031[/TD2][TD2]6,346,374[/TD2] [TD2]11,933,736[/TD2][TD2]11,404,808[/TD2][TD2]10,969,348[/TD2][TD2]10,519,226[/TD2] [TD2]361,502[/TD2][TD2]361,502[/TD2][TD2]300,406[/TD2][TD2]346,428[/TD2] [TD2]60,237[/TD2][TD2]60,237[/TD2][TD2]64,284[/TD2][TD2]61,284[/TD2] [TD2]420,841[/TD2][TD2]427,841[/TD2][TD2]434,841[/TD2][TD2]449,754[/TD2] [TD2]440,000[/TD2][TD2]440,000[/TD2][TD2]399,992[/TD2][TD2]433,841[/TD2] [TD2]273,123[/TD2][TD2]273,123[/TD2][TD2]419,254[/TD2][TD2]415,478[/TD2] [TD2] 31,589,420 [/TD2][TD2] 30,686,949 [/TD2][TD2] 27,910,000 [/TD2][TD2] 27,271,429 [/TD2] [TD2]4,686,770[/TD2][TD2]4,688,596[/TD2][TD2]3,030,493[/TD2][TD2]2,603,498[/TD2] [TD2]2,370,000[/TD2][TD2]2,252,250[/TD2][TD2]1,814,979[/TD2][TD2]1,898,431[/TD2] [TD2]529,484[/TD2][TD2]538,516[/TD2][TD2]576,321[/TD2][TD2]536,465[/TD2] [TD2]600,000[/TD2][TD2]600,000[/TD2][TD2]674,255[/TD2][TD2]629,112[/TD2] [TD2]965,000[/TD2][TD2]965,000[/TD2][TD2]942,129[/TD2][TD2]984,823[/TD2] [TD2]1,500,000[/TD2][TD2]1,500,000[/TD2][TD2]2,020,685[/TD2][TD2]1,915,530[/TD2] [TD2]100,000[/TD2][TD2]100,000[/TD2][TD2]82,500[/TD2][TD2]82,500[/TD2] [TD2] 10,751,254 [/TD2][TD2] 10,644,362 [/TD2][TD2] 9,141,362 [/TD2][TD2] 8,650,359 [/TD2] [TD2]9,000,000[/TD2][TD2]9,200,000[/TD2][TD2]9,510,696[/TD2][TD2]8,761,070[/TD2] [TD2]100[/TD2][TD2]100[/TD2][TD2]100[/TD2][TD2]100[/TD2] [TD2]2,519[/TD2][TD2]2,519[/TD2][TD2]2,594[/TD2][TD2]2,556[/TD2] [TD2]772,164[/TD2][TD2]785,336[/TD2][TD2]795,820[/TD2][TD2]818,250[/TD2] [TD2]650,000[/TD2][TD2]670,000[/TD2][TD2]584,857[/TD2][TD2]756,800[/TD2] [TD2]3,258,750[/TD2][TD2]3,118,500[/TD2][TD2]2,607,458[/TD2][TD2]2,561,886[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2] 24,434,787 [/TD2][TD2] 24,420,816 [/TD2][TD2] 22,642,887 [/TD2][TD2] 21,551,021 [/TD2] [TD2]402,943[/TD2][TD2]402,943[/TD2][TD2]539,536[/TD2][TD2]405,835[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]2[/TD2] [TD2]900,000[/TD2][TD2]900,000[/TD2][TD2]821,156[/TD2][TD2]863,876[/TD2] [TD2] 5,851,689 [/TD2][TD2] 4,963,190 [/TD2][TD2] 3,906,421 [/TD2][TD2] 4,450,695 [/TD2] [TD2]257,300[/TD2][TD2]-41,109[/TD2][TD2]-742,706[/TD2][TD2]-784,627[/TD2] [TD2]465,416[/TD2][TD2]444,788[/TD2][TD2]485,255[/TD2][TD2]416,233[/TD2] [TD2]208,000[/TD2][TD2]200,000[/TD2][TD2]197,344[/TD2][TD2]141,639[/TD2] [TD2]35,000[/TD2][TD2]35,000[/TD2][TD2]35,074[/TD2][TD2]39,345[/TD2] [TD2]46,307[/TD2][TD2]33,246[/TD2][TD2]27,552[/TD2][TD2]18,546[/TD2] [TD2]45,000[/TD2][TD2]45,000[/TD2][TD2]66,613[/TD2][TD2]52,237[/TD2] [TD2]25,000[/TD2][TD2]25,000[/TD2][TD2]-41,476[/TD2][TD2]47,661[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]9,669[/TD2][TD2]-3,984[/TD2] [TD2]-98,734[/TD2][TD2]-512,065[/TD2][TD2]70,633[/TD2][TD2]-169,142[/TD2] [TD2]285,911[/TD2][TD2]-1,267,838[/TD2][TD2]-822,487[/TD2][TD2]-419,277[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]-45,193[/TD2][TD2]-50,001[/TD2] [TD2]-15,000[/TD2][TD2]-15,000[/TD2][TD2]-1,863[/TD2][TD2]-57,583[/TD2] [TD2]65,925[/TD2][TD2]2,045,374[/TD2][TD2]591,737[/TD2][TD2]317,983[/TD2] [TD2]75,000[/TD2][TD2]65,000[/TD2][TD2]61,702[/TD2][TD2]45,795[/TD2] [TD2]0[/TD2][TD2]22,871[/TD2][TD2]-24,439[/TD2][TD2]67,359[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]42,484[/TD2][TD2]-60,560[/TD2] [TD2] 1,395,124 [/TD2][TD2] 1,080,266 [/TD2][TD2] -129,664 [/TD2][TD2] -398,376 [/TD2] [TD2]-700,000[/TD2][TD2]-600,000[/TD2][TD2]-609,813[/TD2][TD2]-655,662[/TD2] [TD2]-60,000[/TD2][TD2]-60,000[/TD2][TD2]-67,400[/TD2][TD2]-72,975[/TD2] [TD2] -760,000 [/TD2][TD2] -660,000 [/TD2][TD2] -682,817 [/TD2][TD2] -728,637 [/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2]100,000[/TD2][TD2]100,000[/TD2][TD2]1,267,746[/TD2][TD2]1,775,481[/TD2] [TD2]-400,000[/TD2][TD2]0[/TD2][TD2]-879,328[/TD2][TD2]-1,389,388[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]-17,500[/TD2] [TD2]100,000[/TD2][TD2]100,000[/TD2][TD2]-113,426[/TD2][TD2]-87,092[/TD2] [TD2]75,000[/TD2][TD2]75,000[/TD2][TD2]31,053[/TD2][TD2]94,018[/TD2] [TD2]-30,000[/TD2][TD2]-30,000[/TD2][TD2]-29,395[/TD2][TD2]-18,787[/TD2] [TD2]-12,000[/TD2][TD2]-12,000[/TD2][TD2]-758[/TD2][TD2]-2,913[/TD2] [TD2]75,000[/TD2][TD2]75,000[/TD2][TD2]179,333[/TD2][TD2]73,704[/TD2] [TD2]-50,000[/TD2][TD2]-50,000[/TD2][TD2]-56,603[/TD2][TD2]-52,942[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]-2,921[/TD2] [TD2] -142,000 [/TD2][TD2] 258,000 [/TD2][TD2] 398,622 [/TD2][TD2] 371,660 [/TD2] [TD2]47,937[/TD2][TD2]17,232[/TD2][TD2]-22,611[/TD2][TD2]10,102[/TD2] [TD2] 541,061 [/TD2][TD2] 695,498 [/TD2][TD2] -436,470 [/TD2][TD2] -745,251 [/TD2] [TD2] 2,931,922 [/TD2][TD2] 2,236,424 [/TD2][TD2] 2,665,673 [/TD2][TD2] 3,367,914 [/TD2] [TD2] 3,472,984 [/TD2][TD2] 2,931,922 [/TD2][TD2] 2,236,424 [/TD2][TD2] 2,665,673 [/TD2]
… s deliveries x deliveries s+x deliveries 3 deliveries 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 1 time costs 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 dio dpo balance sheet current assets cash & eq. restricted cash accts rcvbl inventory prepaids+other total current assets op lease vehicles solar energy sys pp&e intangible assets goodwill mypower rcvbls restricted cash other assets total assets current liabiliites accts payable accrued liabs+other deferred revenue resale value guar cust deposits curr debt+leases curr solar bonds total current liabs lt debt+leases solar bonds rel party conv debt deferred revenue resale value guar other lt liabilities comm stk warrants capital lease oblg total liabilities commits/contings rdmbl ncis in subs conv senior notes nci in subsidiaries common equity cash flow statement cash flows from ops net loss dep/amortization stock-based comp am of debt discount inv write-down loss on disposals forex loss (gain) loss on acq scty non-cash int/other chgs in op as/lb accts rcbl inv / op leases prepaids/other ca mypower rcvbls + other accts pybl/accr liabs deferred revenue customer deposits other lt liabs net cash from ops cash flows from inv pp&e purchases purchase solar sys net cash from inv cash flows from fin stock issued debt issued debt repayments rel pty solar repaids coll lease borrowing stock option excrs capital lease paids stock+debt issue cost investment by nci in subs dist to nci in subs buyouts of nci in subs net cash from fin forex effect net change in cash cash & eq start cash & eq end
NOw that I am unbanned, I can respond.
Overall I think you have a great model. I am only going to comment on what i disagree with, but dont take that as an insult just the items I think arent really feasible.
am not going to argue revenue and GM because I dont think you are being super unreasonable there.
1) You have twice as many vehicles being delivered during the period, and last period was the largest vehicle delivery ever for Tesla, yet you assume the following:
a) Service expenses is flat, i just dont see how you cannot assume some correlation with sales here. If you believe the entire amount of service expense is hitting in Warranty/COGS and Accruals, well then I think we just agree to disagree on GM. I think you either need to assume a sales correlated increase in service expense (all that goodwill baby!) or you are too optimistic on margin. Personally, i think its service expenses. It continues to get worse and worse and in the largest delivery of arguably the most questionable quality batch of cars ever produced by Tesla, you are flat. Very much disagree here. I would say you are 50-100m light on this.
b) You delivered twice as many cars and you are flat on SGA. I know the counter here is that they trimmed 9% and that is fair. However a lot of the SGA expenses in variable, so I think it is very optimistic to assume the 9% is going to offset enough of the delivery costs associated with delivering nearly 80k vehicles. I just don't think its possible, but i know we have discussed this before. I think you are probably 150-200m light here
2) Balance Sheet/CF, there is no way AP is going to be 4.6B, with that said I think you are way overstated on inventory, I believe both are over a billion too high. Tesla is way too high visibility right now as a cash flow risk that AP vendors are going to let Tesla continue to layoff on them, with that said your inventory assumption kind of accounts for it. So it might be a wash at best.
The idea they will be FCF+ by 400m just isnt going to happen. Given 1 above I think you are likely 200-300m light on expenses and given 2 above I think you are likely 300-400 favorable on CF effects.
***
SO overall, great model, if I piggy back on all your work, i come to around a (300m) Net Loss for the period and FCF of (200m). With some accounting trickery maybe they push that FCF to 0, but I do think that is a best case scenario.
Anyways, thanks for posting. Really good stuff