Tesla Tumbles On Margins Miss & Deliveries Downgrade - The Quarter In Three Charts

It appears faith in the hyper-growth names is fading. Tesla is down 8% after hours after humans parsed through its various non-GAAP shenanigans and found:

  • *TESLA 2Q ADJ. TOTAL GROSS MARGIN 23.4%, EST. 26.2%
  • *TESLA SEES YR DELIVERIES 50K-55K MODEL S & X; SAW ABOUT 55K

Not close to whispor numbers and fears of model X production challenges are now dragging down expectations for model S output.

  • *TESLA PLANS TO REVEAL THE MODEL 3 DESIGN IN 1Q 2016
  • *TESLA SEES OPERATIONAL CHALLENGES FOR DELIVERIES IN 4Q

Burning cash...

  • *TESLA CASH,EQUIVALENTS $1.15B AT 2Q END,DOWN $359M SEQUENTIALLY

 

As TSLA admits,

We are now targeting deliveries of between 50,000 and 55,000 Model S and Model X cars in 2015.

 

While our equipment installation and final testing of Model X is going well, there are many dependencies that could influence our Q4 production and deliveries. We are still testing the ability of many suppliers to deliver high quality production parts in quantities sufficient to meet our planned production ramp.

 

Since production ramps rapidly late in Q4, a one-week push out of this ramp due to an issue at even a single supplier could reduce Model X production by approximately 800 units for the quarter. Furthermore, since Model S and Model X are produced on the same general assembly line, Model X production challenges could slow Model S production.

 

Simply put, in a choice between a great product or hitting quarterly numbers, we will take the former. To build longterm value, our first priority always has been, and still is, to deliver great cars.

Tesla EPS: GAAP vs non-GAAP:

Tesla Revenues: GAAP vs non-GAAP (yes, non-GAAP revenues). Note that GAAP revenues in Q2 were lower than in the Q4 2014 quarter!

And finally, free cash flow. It speaks for itself.