Tesla’s 7.8% Drop And What’s Next?
Following the anticipated volatility, the stock renewed a 7.8% drop. As a result, the stock renewed $227, which is not technically in a good shape because the $230 support line has been breached again.
It was a good thing that Tesla’s stock didn’t burn when it went up, and now the response is really important.
As the results are announced, many things will be readjusted.
1) Consens (Growth Rate) Going forward
2) Optional Premium
3) Status of supply and demand (LAGING MAYBE?)
At times like this, I don’t just leave it unattended, but when I observe my business, I think I will be able to increase the quantity in a good position as rain!
Especially if you didn’t have Tesla, it would be a great opportunity! Fighting together! 🙂
[Tesla Research Archives]
naver.me/FdCj738
▶ Tesla
- Despite resumption of vehicle sales growth and accelerated ESS sales, quarterly earnings below consensus due to restructuring costs (-$0.62bn) and unfriendly exchange rates (-$0.30bn)
- Stock plunges (-8%) as expectations turn to disappointment as Street Consensus gains shortly before earnings report
- However, the basis for changing the direction of business performance is full. Above all, the visibility of ‘the long-term recovery of investment machines’ for the development of physical artificial intelligence business is very high. Expectations for confirmation of earnings recovery and business model evolution (FSD/ Robotaxi/ Optimus) among 2H24
▶ 2Q24 Review
- Consolidated revenue of $25.5bn (consensus $24.6bn, +4% above), operating income of $1.61bn (consensus $1.80bn, -11% below), adjusted EPS of $0.52 (consensus $0.60, -13% below)
- VEHICLE BUSINESS: Revenue $19.9bn (-7% YoY, hereinafter YoY), GPM 18.5% (-0.8%p)
- ENERGY BUSINESS: Revenue $3.0bn (+100%), GPM 24.6% (+6.1%p)
- Service Business: Revenue $2.6bn (+21%), GPM 6.4% (-1.3%p)
- Consolidated Performance, Turnaround Evidence Appears
- Vehicle business’s GPM for the past four quarters, despite falling/stalled sales, remained at 18% through downward stabilization of manufacturing costs per unit. Sales growth amid cost control is a GPM turnaround condition. 2Q24 End-of-year vehicle inventory is 18 days, normalized from 28 days at the end of 1Q24.
2H24 sales will rebound strongly by 1) low inventory, 2) entering peak sales season in China, 3) strengthening financial incentives accompanying real interest rate cuts, 4) expanding production capacity of new car lineup (M3 Highland, CT), and 5) securing new demand by strengthening FSD marketability. In the absence of special external variables, profitability level-up can be developed from 3Q24 - Energy Business Records Growth Without Explaining. Will Continue Going forward. Sales Growth Is Ultra-fast, With GPM Maintained in the 24% range. According to guidance (ESS Supply, +75% annual growth), sales and gross profit may increase by +97% and +109% in 2H24, respectively. Shanghai Mega Factory will start operating in 2025, more than doubling its production capacity compared to 2024
- Services Business, Vehicle/Energy Realizes Quarterly Maximum Sales. Service Business has recorded steady growth as it is linked to cumulative sales. Expansion of Supercharger usage through NACS standardization in North America after 2H24 will make the slope of growth steeper
▶ Earnings announcement and Q&A key confirmation issues
- Many questions were asked about roadmaps for the lineup, including Roadster, Cyber Van, and Cyber SUVs, but declined to disclose details. Elon Musk mentioned that he wants to avoid the Osborn Effect. Considering that the new models that the market is expecting do not overlap with the existing lineup, we believe that the derivative lineup of existing models is likely to be revealed. More Affordable Models, which have already been confirmed to be released, reaffirm that 1H25 will start delivering to consumers
- FSD V12.5, starting full-day end-user distribution. V12.5 is a giant model with a 5-fold increase in parameters compared to V12.4 and clearly shows improved driving capabilities. In V12.5.X, the highway stack will be completed with a single stack merged with the city driving stack
- Acquiring FSD data is accelerating rapidly. The number of FSD users is also recording a significant increase through free trial services and price cuts. FSD introduction market, there is a high possibility of securing regulatory approval to enter Europe, China, and other countries within this year. FSD licensing, some OEMs showed interest. It is expected that the number of OEMs who want FSD licensing will continue to increase. However, details cannot be disclosed yet
- xAI, with shareholder consent, can proceed with Tesla’s investment in xAI. Will be able to integrate Grok into Tesla software in the future
- Optimus in some vehicle production lines. New model for mass production (3rd generation Optimus) has been designed, mass production begins in early 2025. Thousands of Optimus units will be used within Tesla by 2025. Mass production and external sales start after 2026
- The Robotaxi Unveil event will further unveil new developments that materialize, as well as Robotaxi, on Oct. 10. Details about FSD and Optimus (technology progress and business models) will be included
- 4680 battery cells continue to increase QoQ production in 2Q24 (+51%). Securing 4680 mass production capacity to respond to 1,400 CT units on a weekly basis. Expected to be 2,500 units at the end of the year. Completed the first verification of dry process application at 4680 production facility recently. Preparation for the official introduction of dry process at the end of this year, normal progress. Profitability of CT, introduction of 4680 dry process and expansion of production capacity can significantly improve from 4Q24
- Gi