TSLA Market Action: 2018 Investor Roundtable

[Artful Dodger]

MODS: When certain users habitually show up to spread FUD hours before Quarterly Earnings Reports, may I suggest they be given a further 7 day break? You know, just to give them ample opportunity to consider their position. Thank-you.

 

[mutle]

News from Tesla Germany, they have hired a new press officer, who also was the first press officer for Google in Germany:

t3n Magazin on Twitter
Stefan Keuchel heuert bei Tesla an

The hiring process apparently took 3 months and 11 interviews.

 

[Fact Checking]

Just some quick early morning price action observation: global macro indices are nervous with a pessimistic tone, there's swings both on NASDAQ and Dow futures, and on EUR/USD as well.

It's unclear to what extent macro is going to determine today's TSLA trading: some of these moves were followed by TSLA pre-market trading - the early drop was mostly in line with the NASDAQ drop of -1.5%, but there's also some pre market buying as well now as the East Coast is waking up - presumably digesting the implications of the early earnings report of Tesla.

 

[Chocochip]

Here's what I would really want Elon to address (with numbers) or be asked about during the CC:

1. If Q3 was profitable, were the numbers "massaged" in any way to make the financials better than they normally would be? Any ZEV credits used? Any significant costs or expenses deferred?
2. Update on timeline for the new Tesla NN chip entering volume production. Also, are the current Nvidia chips sufficient for final version (all expected features active) of EAP? Will all customers who paid for FSD since that option was available to order be upgraded to the new chip for free?
3. Current M3 production levels, and the expected (realistic) production levels by EOY
4. Commentary on M3 demand mix at the moment (this may put to bed the "demand for top-end versions has dried up" narrative)
5. Any specific difficulties in getting the M3 certified / approved for sale in Europe? If not, what criteria does the management use to determine a good time to start European sales of the M3. There's been a lot of FUD peddled on that recently.
6. Total number of Tesla VPs / C-level executives currently active. Hopefully this would put the recent departures into some sort of perspective (e.g. two VPs left, 35 remaining)
7. Who will the new chairman be, and what factors contributed to the decision (I expect this to be announced either in the investors letter or during the CC).

I think I know the answer to most of these, but it's important to get clear info and confirmation directly from the management, to kill some of the short theses. Just to force them to lift those goal posts and move them further... they might strain their backs or something in the process.

Other topics to be addressed only if positive: Model Y launch and planned production facility; the Shanghai gigafactory.

Later edit: I am aware that many of these questions can be answered based on info found either in tweets or replies to tweets or in previous CCs. I think, however, that many of the theses put forward by shorts gain traction because many investors are not as granular in analysing the available information as some of the people on this forum. The CC is a great opportunity to put out specific information and promote the right narrative, and it is generally more difficult to dismiss if done properly, simply because more people pay attention to it than to individual tweets scattered across several months.

 

[Fact Checking]

If Q3 was profitable, were the numbers "massaged" in any way to make the financials better than they normally would be? Any ZEV credits used?

ZEV credits are part of the regulatory environment just like tariffs, import duties and taxes are part of the regulatory environment. Tariffs, import duties and taxes decrease income, ZEV and other regulatory credits increase income.

Neither side should be excluded.

Any significant costs or expenses deferred?

Tesla typically defers more expenses than they normally should, such as conservatively estimated and provisioned warranty costs, or resale guarantee costs.

It's not really possible to 'defer' expenses - either an expense applies to this reporting period or not, but they defer some revenue from every unit sold which reduces income.

Update on timeline for the new Tesla NN chip entering volume production. Also, are the current Nvidia chips sufficient for final version (all expected features active) of EAP? Will all customers who paid for FSD since that option was available to order be upgraded to the new chip for free?

Note that most of these questions were already answered in the past: yes, NVidia Pascal chip is enough for EAP, and yes, all FSD customers on an AP 2.0 or later hardware platform get the new HW3 hardware for free. (Not truly for free: they already paid for it by paying for the FSD option.)

 

[Fact Checking]

Thanks! Do gas savings and incentives change the graph at all?

Yes, they further improve Tesla's addressable market - but the numbers I cited do not include these factors, as they change by country and by state: incentives are larger in the U.S. but gas savings are lower - while it's the other way around in Europe.

 

[mrdoubleb]

ZEV credits are part of the regulatory environment just like tariffs, import duties and taxes are part of the regulatory environment. Tariffs, import duties and taxes decrease income, ZEV and other regulatory credits increase income.

Neither side should be excluded.



Tesla typically defers more expenses than they normally should, such as conservatively estimated and provisioned warranty costs, or resale guarantee costs.

It's not really possible to 'defer' expenses - either an expense applies to this reporting period or not, but they defer some revenue from every unit sold which reduces income.



Note that most of these questions were already answered in the past: yes, NVidia Pascal chip is enough for EAP, and yes, all FSD customers on an AP 2.0 or later hardware platform get the new HW3 hardware for free. (Not truly for free: they already paid for it by paying for the FSD option.)

I think what @Chocochip is trying to say is that repeating, reaffirming, clarifying some of this should help directly address expected FUD. Not that they can't come up with new stuff, but they should try to leave little room for guessing.

 

[Chocochip]

ZEV credits are part of the regulatory environment just like tariffs, import duties and taxes are part of the regulatory environment. Tariffs, import duties and taxes decrease income, ZEV and other regulatory credits increase income.

Neither side should be excluded.

Thanks for the details, and yes, I agree. See the edit in my post.

 

[Chocochip]

I think what @Chocochip is trying to say is that repeating, reaffirming, clarifying some of this should help directly address expected FUD. Not that they can't come up with new stuff, but they should try to leave little room for guessing.

Can you be my tl;dr guy going forward? Thanks!

 

[Sudre]

Here's what I would really want Elon to address (with numbers) or be asked about during the CC:.......

Sadly we will probably get questions like,

1. How will cars drive on Mars and do you think they will end up taking over Mars?

2. When are you giving us more stock to hand out to shorts so we can force your SP lower while still making a fortune?

3. I know you previously said you will pay off the bonds but I have to ask, when are you going to give us more shares instead?

4. When will you raise more capital?

5. I’ve lost my crayons. Can you color for me? Please stay in the SEC lines.

6. I see you are making positive GM on Model 3, how are you profiting?

I am not as good at framing the questions as well as the typical phone in freaks. Maybe we could just dump all the idiots and go with retail investors who have questions that are important. It would crash the stock again but I would laugh my ass off if the phone announcing lady said, “And now the lines are open for questions. Here is the Hyperchange guy having a conversation with Elon for the next hour. Goodbye. “

 

[Chickenlittle]

News from Tesla Germany, they have hired a new press officer, who also was the first press officer for Google in Germany:

t3n Magazin on Twitter
Stefan Keuchel heuert bei Tesla an

The hiring process apparently took 3 months and 11 interviews.

Harry Potter fans will know what I mean, reminds me of how the hogworths teacher of the dark arts fares, hint they don’t survive the movies

 

[erha]

Something just happened: We bounced to green numbers in pre-market

 

[Tslynk67]

Pre-market shooting up a bit, some news? I guess someone knows the Q3 results.

Maybe they stole someone's briefcase, on a train...

 

[FS_FRA]

News from Tesla Germany, they have hired a new press officer, who also was the first press officer for Google in Germany:

t3n Magazin on Twitter
Stefan Keuchel heuert bei Tesla an

The hiring process apparently took 3 months and 11 interviews.

Good hire, but the article is just FUD: "...Stefan Keuchel was Google's first press spokesman in Germany. Now he is surprisingly engaged by the crisis-ridden electric car manufacturer Tesla. Does the 49-year-old have to play the fireman for Elon Musk?..."

Edit: have to add a bit more FUD from the article: "...The tough selection process of the Californians was probably also necessary, because Tesla has been under criticism for months. The production targets of the coveted Model 3 could not be achieved several times. In addition, there were various negative headlines about Tesla boss Elon Musk, who publicly raved against shareholders and dragged on a joint in an interview. In Germany, Tesla also quarrelled with unions about insufficient wages at the subsidiary Grohmann Automation....."

First thing Mr. Keuchel should do is fix the FUD in all German-speaking Media that is so heavily big-Auto/big-Oil influenced.

 

[humbaba]

Pre-market shooting up a bit, some news?

i'd wager more people making it through the morning news and noticing tomorrow's call

 

[KarenRei]

Let me sum up most questions:

"Hi, thanks for taking the time to speak with us. My first question is: In the Q3 update it clearly says Thing-That-Completely-Invalidates-Short-Thesis-I-Believe-In. But is there a chance that Thing-That-Contradicts-The-Q3-Update-That-Might-Support-My-Short-Thesis? Also, my second question: How do you plan to Thing-That-You've-Already-Clearly-Explained-But-I-Don't-Believe?"

 

[Chickenlittle]

I have always seen tesla give 2 week notice of report but no obligation to do so. Wonder if that may change this qtr. I doubt Musk is in love with Wall Street and could screw with them about this

This is pretty close to prediction that I will make. I suspect this is being done to get out some news that shouldn’t be released during “quiet period”. I am not sure what, could it be related to China time table? Don’t know but it’s always interesting when it comes to tsla and tesla

 

[ggr]

Sudden jump up, while Dow, S&P and NASDAQ all tank further. What can it all mean?

 

[RoadsterPlease]

I also think that someone big decided it's time for some earnings play, even though we have rough macro

 

[humbaba]

I also think that someone big decided it's time for some earnings play, even though we have rough macro

I don't think so: its not that many shares -- just that premarket amplified the effect. OTOH it looks too many (to me, anyway) to be bears getting some discount shares to dump for latter price depression.

I still think its most likely more people reading their 9am news. Of course, I'm probably wrong