Tesla Q1 2019 Financial results Overview

Author: Ruban
Sector: Autos
Industry: Consumer Cyclical


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Important Finacial Numbers:

The total Automotive revenue was $3.723 billion which was 41% less compared to the previous quarter and 36% more compared to the same quarter last year.

The total revenue from Energy generation and storage business stood at $324.661 million which is 13% lesser compared to last quarter and about 21% lesser compared to the same quarter last year.

The company reported an operating loss of $522 million and GAAP net loss of $702 million, the stated loss also includes non-recurring charges of $188 million.

The company ended the quarter with $2.2 billion cash and cash equivalents, which is $1.5 billion reductions from the end of 2018, this reduction was driven by a $920 million convertible bond repayment and an increase in the number of vehicles in transit to customers at the end of Q.

Vehicle production and deliveries:

Model 3:


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The produced roughly 63,000 Model 3 vehicles in Q1, which was approximately 3% more than the previous quarter. The company stated that this improvement in production rate was modest mainly due to changes in the production process for the introduction of new variants of Model 3, fewer working days and a supplier limitation. The company started production and deliveries of Model 3 vehicles for overseas markets during Q1. To quickly meet international demand, Europe and China, the company stated that Model 3 builds occurred in the first half of the quarter, with builds for local US markets in the second half. This wave of quarter-end deliveries in the US, China, and Europe meant that even short delays caused deliveries to be deferred to Q2.

The company stated that Model 3 was yet again the best-selling premium car in the US in Q1, outselling the runner-up by almost 60%. This is not surprising given that, for the first time in history, the price of an electric vehicle is lower than its gas-powered equivalents. While global premium vehicle sales reached 8 to 9 million units (depending on definition) last year, the Model 3 is attracting buyers from other segments. Since the introduction of Model 3 Standard Range and Standard Range Plus, 69% of trade-ins were non-premium vehicles, indicating that Model 3 is demonstrating appeal beyond the premium segment.

Model X and S:


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Deliveries of Model S and Model X declined to 12,100 vehicles in Q1 compared to two- year run rate of roughly 25,000 units per quarter. This decline was mainly caused by weaker Q1 demand due to seasonality, pull-forward of sales into Q4 2018 in the U.S. due to the first scheduled reduction of the federal EV tax credit in Q1 and discontinuation of 75 kWh battery pack. The company stated that they also had a mismatch between orders and deliverable cars. For example, due to adjustments in pricing mid-quarter, the take rate for the performance versions of Model S and Model X increased faster than they were able to supply.

Model Y:



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The company launched model Y in Q1, the long-range version of Model Y will be an all-electric compact SUV priced at $48,000, roughly $20,000 less than other all-electric SUVs. Given the well-appointed standard equipment, superior acceleration and handling, interior size and up to a 300-mile range that the company believes that ultimately Model Y will record higher sales than Model S, Model X and Model 3 combined.

Autopilot:


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The company recently hosted its first-ever Autonomy Investor Day, showcasing its new in-house designed full self-driving (FSD) computer and our AI-based software

Fully Self-driving Computer:

Their new FSD computer is capable of processing 2,300 images per second, about 21-times more than the processor they used previously.

AI-based software:

AI-based software trained by more than 400,000 Tesla vehicles. It is expected that this foundation will enable Tesla to make its vehicles fully autonomous (subject to regulatory approvals) through over-the-air software updates, enabling Tesla and its customers to use the Tesla ride-hailing network fleet and generate income.

Robotaxi:


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A custom-made robotaxi capable of running about a million miles using a single battery pack, with all the sensors and computing power for full autonomy, should cost less than $38,000 to produce. Telsa believes low vehicle cost, low maintenance cost and an expected powertrain efficiency of 4.5 miles per kWh should make this the lowest cost of ownership, and to be the most profitable autonomous taxi on the market.

Outlook:

The company reaffirmed its prior guidance of 360K to 400K vehicle delivers in 2019 which represents approximately 45% to 65% increase compared to 2018. The company also stated that if their Shanghai Gigafacotry is able to reach volume production in early Q4 this year, they may able to produce as many as 500K vehicles globally in 2019. The company believes it will deliver between 90,000 and 100,000 vehicles in Q2.


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