Tesla Announces 1Q 2018 Earnings...The Most Bizarre Earnings Call Ever
Tesla reported its Q1 2018 earnings Wednesday, posting losses of $3.35 per share on $3.4 billion of revenue. Analysts expected Tesla to report a loss of $3.48 a share with revenues of $3.22 billion, so although another losing quarter, they beat the forecast. Tesla’s net losses were a record $784.6 million.
Financial numbers can be manipulated to present a certain picture, so I focus most on cashflow. Tesla ended Q1 with $2.7 billion in cash, down from $3.4 billion in cash at the beginning of the year. There are many people on Wall Street who think Tesla will be bankrupted by the end of this year.
Tesla said demand for the Model S and Model X is still quite strong. In Q1, Tesla had its highest order number ever. However, its the Model 3 that will determine Tesla's future. Tesla said it had hit a record of producing 4,750 Model 3 vehicles in two weeks in the month of April. Tesla stated if it can produce 5,000 Model 3 cars per week, Tesla expects to be profitable in Q3 and Q4 of this year.
It wasn't the financial numbers that mattered most on this particular earnings call. It was his responses to some of the analysis questions:
Sanford Bernstein's Toni Sacconaghi: "And so where specifically will you be in terms of capital requirements?"
Musk: "Excuse me. Next. Boring, bonehead questions are not cool. Next?"
How about this one:
Musk: We can do a 500-mile range Semi today. I think the actual production unit will be about 600-mile range.
Russell: Awesome. Great stuff. So, I'm also wondering, are you guys going to let Porsche best you to market with a 350 kilowatt-hour Supercharger? Because I know you've mentioned V3
Musk: ...ask questions that are not boring.
Here's another one:
Musk: "We have no interest in satisfying the desires of day traders. I couldn't care less. Please sell our stock and don't buy it."
Elon Musk and Tesla paid the price for his behavior on Thurs. when stock fell 5.5% or $16.70.
Elon Musk tried to justify his behavior on Twitter Friday morning.
So Elon Musk's behavior got me thinking, are genius, also crazy. I mean I think Steve Jobs was a genius, but crazy as well. I think Jeff Bezos is a genius, but crazy too. Well, according to Rob Waugh of Daily Mail there could be some scientific evidence to back up these thesis. According to Waugh, "There IS a link between creative genius and madness — with both schizophrenia and bipolar disorder frequent in highly creative and intelligent people.”
The questions remains, is John Thompson of Vilas Capital Management going to be right, will Tesla be bankrupt within the next four months. See the post below for details.
They won't go bankrupt this year, but that doesn't mean I still wouldn't avoid the stock. Stick with investing in better, more boring and profitable companies.
I hear you, that's why if Tsla gets below $250, it's a short with a target to $180.
Appreciate the comment.
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