q1 2018 earnings estimates

[luvb2b]

i'll accept good luck over skill

storage not likely to be positive based on comments in outlook: "With increasing capacity for Powerwall and Powerpack products at Gigafactory 1, energy generation and storage revenues should continue to grow significantly throughout the year. Energy storage gross margins should therefore become positive in the second half of 2018. Our solar business is likely to experience mild growth for another quarter or two before our revised sales strategy starts to show its full impact in final deployments."

i agree on being surprised by drop in d&a. they may be finding some of their tools last longer so adjusting lifespan or something.

I agree but we shouldn't be blind for a bit of a lucky break.

Also, this is the first time that I feel battery storage is actually contributing to the bottom line positively and in a meaningfull way. I am calculating revenues of around $600/kWh for storage and costs of around $520/kWh. Still ways off from 30% gross margin, but at least solid single digits. On the other hand Tesla is really struggling to make anything from the solar side now. I am fine with that. Except for the 1GWh of panels that Panasonic is going to deliver this year to Tesla, I can't see there being much value from them in regular panel installations.

On cash flow, I was surprised to see a drop in D&A. I expected this number to rise as Tesla continues to invest heavily. Beyond that I agree it's weird they changed their reporting.

 

[luvb2b]

i don't fully understand how services revenues (ex-used car sales) works. obviously if used car sales are slightly +ve gross margin then service itself is a disaster on gross margin.

but, is the cost of the extra service center capacity being pulled into cogs for services? and do revenues of services come from warranty services (pulling warranty reserves to booked revenue)?

if so then extra service center capacity can inflate the cost of services, and the revenue won't flow until more cars on the road using warranty services. so i would expect as the fleet grows and capacity gets utilized that the services gross margin will push towards 0. @Reality you may know more about this than me.

the idea of using "accessories" (hats and t-shirts?) to boost service center revenue sounds a bit silly, but we're talking about a guy who sold millions of dollars of t-shirts on twitter so what do i know.

@luvb2b

what do you mean by this? ARe you saying because there will be so many M3's on the road that it will be impossible to hide?


"6. services margin looks very poor. i don't know how the costs of extra service centers flow into that, but shorts will say there's more repair expense getting hidden in services. another quarter or two and we'll know."



I agree the change in OPEX isnt significant, we wont know how much it scales until early 2019 at the earliest

 

[Waiting4M3]

i don't fully understand how services revenues (ex-used car sales) works. obviously if used car sales are slightly +ve gross margin then service itself is a disaster on gross margin.

but, is the cost of the extra service center capacity being pulled into cogs for services? and do revenues of services come from warranty services (pulling warranty reserves to booked revenue)?

if so then extra service center capacity can inflate the cost of services, and the revenue won't flow until more cars on the road using warranty services. so i would expect as the fleet grows and capacity gets utilized that the services gross margin will push towards 0. @Reality you may know more about this than me.

the idea of using "accessories" (hats and t-shirts?) to boost service center revenue sounds a bit silly, but we're talking about a guy who sold millions of dollars of t-shirts on twitter so what do i know.

How do you think Tesla's recent decision to no longer do cosmetic repair for used cars will affect this? or is that decision a result of the poor margin?

 

[Esme Es Mejor]

Well I’m really happy this morning, how about everyone else?

I was very happy to get shares for 277 this morning. I wasn’t looking to add to my position, but when people insist on offering free money, it’s impolite to turn them down.

 

[neroden]

6. services margin looks very poor. i don't know how the costs of extra service centers flow into that, but shorts will say there's more repair expense getting hidden in services. another quarter or two and we'll know.

FWIW, I think Tesla lost meaningful amounts of money on the early extended warranty / extended service plan deals, which I bought. It provided a cash injection at the time, but there have been a lot of expensive repairs covered. Remember they were covering first-year-model cars (so with a much higher rate of warranty issues than later) for 8 years for, frankly, peanuts upfront. This cost has to be credited to services rather than COGS since it was an aftermarket extended warranty purchase. Those late 2012 - early 2013 cars just got into the extended warranty period last year.

I don't think this is a big deal long term.

2. storage margins continue negative at -23% but the highest of the last 4 quarters. i can't even believe this product runs so far in the red but they say it should finally turn positive in the back half. positive! i thought this would be a 20% gross margin product!

Yeah, I don't understand what their accounting method is here. Are they doing time-based depreciation on a bunch of the capital equipment, rather than units-of-production based depreciation? Is there a bottleneck which is preventing equipment/labor from being used at full capacity? Is there a suboptimal delivery/installation system which is jacking up costs? This is a question I'd like answered. I don't believe for a minute that they're selling below long-run marginal cost, so what's up?

 

[schonelucht]

Also, this is the first time that I feel battery storage is actually contributing to the bottom line positively and in a meaningfull way. I am calculating revenues of around $600/kWh for storage and costs of around $520/kWh.

Revenue for the South Australian project was $72.5M or $562/kWh. With smaller projects, overhead revenue is likely a bit higher therefore I feel pretty good about $600/kWh overall. The cost side needs more work to estimate correctly.

 

[mongo]

Revenue for the South Australian project was $72.5M or $562/kWh. With smaller projects, overhead revenue is likely a bit higher therefore I feel pretty good about $600/kWh overall. The cost side needs more work to estimate correctly.

Yah, a futher data point here, the 10-Q had this to say, so gross margin should improving:

Cost of energy generation and storage revenue increased by $223.6 million, or 147%, in the three months ended March 31, 2018 compared to the three months ended March 31, 2017. This is primarily due to higher MWh deployed in the three months ended March 31, 2018 including the cost related to the South Australia battery project. Additionally, cost increased for energy generation due to additional systems deployed.

Gross margin for energy generation and storage decreased from 29% to 8% in the three months ended March 31, 2018 as compared to the three months ended March 31, 2017 . Energy storage revenue as a percentage of energy generation and storage revenue was higher for the three months ended March 31, 2018 as compared to the three months ended March 31, 2017, resulting in lower gross margin as we had negative margins for energy storage due to manufacturing under-utilization and one-time costs.

 

[luvb2b]

here's how my estimates would have looked under the old accounting standards.

within 2m on the bottom line excluding those pesky nci's. gives me good confidence that i understand this business, but it could be dumb luck i guess.

…

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 q1-18 [/TD2][TD2] Mar-18 [/TD2][TD2] Dec-17 [/TD2][TD2] Mar-17 [/TD2] [TD2] 0.15 [/TD2][TD2] 0.21 [/TD2][TD2] 0.23 [/TD2][TD2] 0.26 [/TD2] [TD2] 99.00 [/TD2][TD2] 101.80 [/TD2][TD2] 98.15 [/TD2][TD2] 108.06 [/TD2] [TD2] 53.00 [/TD2][TD2] 56.00 [/TD2][TD2] 53.00 [/TD2][TD2] 0.00 [/TD2] [TD2]1,834,470[/TD2][TD2]1,754,337[/TD2][TD2]2,148,241[/TD2][TD2]2,000,060[/TD2] [TD2]433,540[/TD2][TD2]458,192[/TD2][TD2]81,726[/TD2][TD2]0[/TD2] [TD2]3,49,755[/TD2][TD2]3,38,375[/TD2][TD2]2,93,086[/TD2][TD2]2,54,540[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]35,000[/TD2] [TD2]0[/TD2][TD2]50,314[/TD2][TD2]179,142[/TD2][TD2]0[/TD2] [TD2] 2,617,765 [/TD2][TD2] 2,601,218 [/TD2][TD2] 2,702,195 [/TD2][TD2] 2,289,600 [/TD2] [TD2]1,71,828[/TD2][TD2]1,88,465[/TD2][TD2]80,037[/TD2][TD2]5,244[/TD2] [TD2]218,000[/TD2][TD2]225,000[/TD2][TD2]218,000[/TD2][TD2]208,700[/TD2] [TD2]-3,000[/TD2][TD2]0[/TD2][TD2]-2,600[/TD2][TD2]22,400[/TD2] [TD2]300,000[/TD2][TD2]263,412[/TD2][TD2]290,617[/TD2][TD2]170,326[/TD2] [TD2] 3,304,593 [/TD2][TD2] 3,278,095 [/TD2][TD2] 3,288,249 [/TD2][TD2] 2,696,270 [/TD2] [TD2]1,413,528[/TD2][TD2]1,315,753[/TD2][TD2]1,740,075[/TD2][TD2]1,496,649[/TD2] [TD2]553,150[/TD2][TD2]559,519[/TD2][TD2]259,556[/TD2][TD2]0[/TD2] [TD2]2,24,641[/TD2][TD2]2,25,581[/TD2][TD2]1,91,541[/TD2][TD2]1,66,026[/TD2] [TD2] 2,191,319 [/TD2][TD2] 2,100,853 [/TD2][TD2] 2,191,172 [/TD2][TD2] 1,662,675 [/TD2] [TD2]189,010[/TD2][TD2]217,863[/TD2][TD2]137,835[/TD2][TD2]6,373[/TD2] [TD2]152,600[/TD2][TD2]157,500[/TD2][TD2]143,880[/TD2][TD2]145,400[/TD2] [TD2]11,000[/TD2][TD2]11,000[/TD2][TD2]11,000[/TD2][TD2]14,900[/TD2] [TD2]366,000[/TD2][TD2]369,969[/TD2][TD2]365,576[/TD2][TD2]198,976[/TD2] [TD2] 2,909,929 [/TD2][TD2] 2,857,185 [/TD2][TD2] 2,849,463 [/TD2][TD2] 2,028,324 [/TD2] [TD2] 394,663 [/TD2][TD2] 420,910 [/TD2][TD2] 438,786 [/TD2][TD2] 667,946 [/TD2] [TD2]25.0%[/TD2][TD2]26.3%[/TD2][TD2]20.9%[/TD2][TD2]27.4%[/TD2] [TD2]25.0%[/TD2][TD2]26.3%[/TD2][TD2]20.9%[/TD2][TD2]26.3%[/TD2] [TD2]-27.6%[/TD2][TD2]-22.1%[/TD2][TD2]-217.6%[/TD2][TD2]0.0%[/TD2] [TD2]16.3%[/TD2][TD2]17.6%[/TD2][TD2]13.2%[/TD2][TD2]26.3%[/TD2] [TD2]-10.0%[/TD2][TD2]-15.6%[/TD2][TD2]-72.2%[/TD2][TD2]-21.5%[/TD2] [TD2]30.0%[/TD2][TD2]30.0%[/TD2][TD2]34.0%[/TD2][TD2]30.3%[/TD2] [TD2]466.7%[/TD2][TD2]-100.0%[/TD2][TD2]523.1%[/TD2][TD2]33.5%[/TD2] [TD2]-22.0%[/TD2][TD2]-40.5%[/TD2][TD2]-25.8%[/TD2][TD2]-16.8%[/TD2] [TD2]320,000[/TD2][TD2]332,096[/TD2][TD2]319,637[/TD2][TD2]239,070[/TD2] [TD2]540,000[/TD2][TD2]546,404[/TD2][TD2]542,290[/TD2][TD2]446,637[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]67,000[/TD2] [TD2]35,000[/TD2][TD2]35,000[/TD2][TD2]35,000[/TD2][TD2]44,800[/TD2] [TD2]140,000[/TD2][TD2]140,000[/TD2][TD2]140,000[/TD2][TD2]127,988[/TD2] [TD2] 1,035,000 [/TD2][TD2] 1,053,500 [/TD2][TD2] 1,036,927 [/TD2][TD2] 925,495 [/TD2] [TD2] -640,337 [/TD2][TD2] -632,590 [/TD2][TD2] -598,141 [/TD2][TD2] -257,549 [/TD2] [TD2]6,000[/TD2][TD2]5,214[/TD2][TD2]6,280[/TD2][TD2]3,090[/TD2] [TD2]-100,000[/TD2][TD2]-102,546[/TD2][TD2]-99,363[/TD2][TD2]-46,146[/TD2] [TD2]-53,000[/TD2][TD2]-47,000[/TD2][TD2]-47,000[/TD2][TD2]-53,200[/TD2] [TD2]-12,000[/TD2][TD2]-37,716[/TD2][TD2]-41,677[/TD2][TD2]-18,098[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2][TD2]0[/TD2] [TD2] -799,337 [/TD2][TD2] -814,638 [/TD2][TD2] -779,901 [/TD2][TD2] -371,903 [/TD2] [TD2]20,000[/TD2][TD2]6,332[/TD2][TD2]-9,094[/TD2][TD2]25,278[/TD2] [TD2] -819,337 [/TD2][TD2] -820,970 [/TD2][TD2] -770,807 [/TD2][TD2] -397,181 [/TD2] [TD2]-50,000[/TD2][TD2]-75,076[/TD2][TD2]-95,457[/TD2][TD2]-66,904[/TD2] [TD2] -769,337 [/TD2][TD2] -745,894 [/TD2][TD2] -675,350 [/TD2][TD2] -330,277 [/TD2] [TD2]170,000[/TD2][TD2]169,146[/TD2][TD2]168,314[/TD2][TD2]162,129[/TD2] [TD2]170,000[/TD2][TD2]169,146[/TD2][TD2]168,314[/TD2][TD2]162,129[/TD2] [TD2] -4.53 [/TD2][TD2] -4.41 [/TD2][TD2] -4.01 [/TD2][TD2] -2.04 [/TD2] [TD2]-769,337[/TD2][TD2]-745,894[/TD2][TD2]-675,350[/TD2][TD2]-330,277[/TD2] [TD2]140,000[/TD2][TD2]141,639[/TD2][TD2]134,348[/TD2][TD2]103,717[/TD2] [TD2]0[/TD2][TD2]0[/TD2][TD2]27,950[/TD2][TD2]11,571[/TD2] [TD2]-629,337[/TD2][TD2]-604,255[/TD2][TD2]-513,052[/TD2][TD2]-214,989[/TD2] [TD2] -3.70 [/TD2][TD2] -3.57 [/TD2][TD2] -3.05 [/TD2][TD2] -1.33 [/TD2]

 

[Reality]

wow, that is amazing impressive


post Q2!

 

[bdy0627]

wow, that is amazing impressive


post Q2!

I would love to see an early estimate for Q2 based upon current projections that is revised as the quarter progresses.

 

[luvb2b]

it takes a lot of time to work these things out. it will take me a while even to get thru the accounting and other changes. so patience!
the accuracy of my estimates usually improves materially after the end of the 2nd month of the quarter, when i can project deliveries. then the end of the quarter delivery number also helps greatly.

and of course there's a shi1 ton of guesswork and luck involved.

I would love to see an early estimate for Q2 based upon current projections that is revised as the quarter progresses.

 

[RAVAGESofTIME]

I find it interesting that @ShortSeller and @Reality both troll the same three or four threads almost exclusively. They both joined in April. They both have the same short thesis. I'm just wondering if they might be the same person trying to look like two people. Has anyone caught one of them accidentally answering for the other one?

 

[Reality]

I find it interesting that @ShortSeller and @Reality both troll the same three or four threads almost exclusively. They both joined in April. They both have the same short thesis. I'm just wondering if they might be the same person trying to look like two people. Has anyone caught one of them accidentally answering for the other one?

im not him, but i think he is a pretty cool guy


he did say something the other day that what he did for work was really simliar to what i do, i think, so with just that i think you have more proof that we are the same person than you do that Tesla is going to be a profitable entity one day.