Tesla Q2 2016 earnings in a nutshell

[BornToFly]

See what?
They have missed almost all of their production forecasts on the last 2 years and grew 67 percent from last year, same quarter sales grew less than that, and growth from last quarter grew less and you are surprised that there are people who don't believe in the 100 percent growth???

LOL

Delivery was down last quarter because of the late ramp and shipping, but orders and production were not. When they start Model 3 next year, I think delivery numbers for the year will be double this year (S + X + 3). You seem to do a lot of posting with zero homework. Did you even bother to read the earnings report and listen to the conference call, or are you just here to be an annoying troll?

 

[Matias]

Number of Model 3 deliveries 2017 is totally unknown at the moment.

Remember what happened with Model X. It got postponed several times and after "launch" last autum they finally delivered few hundred cars in whole last year (despite Elon's exponential and ballistic production ramp up) which all needed fixings afterwards.

I'm positively surprised if they deliver more than few thousand Model 3 next year, but I'm not surprised if we see part deux of Model X ramp up.

 

[Cal1]

They sold 1.7 Billion in new shares. This is not a difficult concept to understand. If you wanted to start a new business manufacturing product X, and you don't even have a warehouse, you are going to have to spend money to eventually make the product and make money. You have to get the warehouse/factory. You have to pay for the manufacturing equipment to make your widget, you have to pay for supplies, etc. In the case of Tesla, they have to build a new production line, they have to build a new 5 billion dollar factory, they have to build 100's of retail stores and service centers, they have to build superchargers, etc. They have to lose money for a few more years investing in capital. THEY ARE NOT BURNING CASH, they are investing. The cars each make a healthy profit, and demand is up 67% from last year. Next year they will grow another 100+ percent. There is no credible competition on the horizon. This, to me, is the most obvious money making investment of my lifetime. I can't believe the number of people that can't see it. This is different then when GM went bankrupt because they couldn't sell their product with adequate margins, no significant increase in demand to look forward to, and out of control costs despite little to no innovation and infrastructure investment.

So daily cash flow is coming from banked $ from previous primary offerings? The losses reported is how much that cash stock pile is shrinking. I did see somewhere that we were losing $20k/car. Not true?

I am and investor and love the company, concept, future long term. The stuff that make me cringe are not the financials but rather the way Elon runs things. Much too much Jobish but that's a whole other Oprah. Have you read his book?

 

[BornToFly]

I did see somewhere that we were losing $20k/car. Not true?

Not True. They have positive gross margins on the cars of over 20%. People who say Tesla loses money on every car are idiots who take everything Tesla spends on the business including capital growth, and divide that number by the money paid for the cars. If Tesla was really losing money on every car it sold, then selling more cars would be bad. Instead, they make a lot on each car, and would not need any capital raises if they could sell more of them right now (which they can't).

 

[Matias]

About investing in growth.

If the asset's useful life extends more than a year, then the company must capitalize the expense, using depreciation to spread the cost of the asset over its designated useful life. Capital expenses are most often depreciated over a five- to 10-year period.

So does investments in machinery, buildings, superchargers etc explain losses, because they are depriciated over several years?

 

[Crowded Mind]

Much too much Jobish

Too much like the man who created the most valuable company in the world?

 

[adiggs]

Context - I'm a long term investor.

Personally, quarterly delivery numbers are noise to me. I care about quarterly production. The assumption and belief on my part, based on my understanding of Tesla's business model, is that a produced car in this quarter that isn't delivered, is a delivery next quarter. Whether a given delivery occurs this quarter or next is immaterial to my view of the business.

As long as the quarter over quarter production is increasing, then I expect to see a lag between deliveries and production, with deliveries falling short of production. With the demand the company is seeing for it's cars (S/X now, 3 coming), what I care about is production (and production rate), as these tell me how the company is proceeding, long term, towards finding out what actual demand is and satisfying as much of it as the market will accept.

I like today's quarterly losses, as it indicates Tesla is investing aggressively to create the production ramp needed to get closer to satisfying demand.