what elon musk just said | Tesla earnings call

uh this is I think a very important

summary and I'll give you my thoughts

and thesis on all of this so let's get

right into it okay here we

go all right the earnings call gave us

some color that I don't think was as

great as the color that I wanted to hear

especially off of the backs of honestly

what was a really good overall earnings

report I I know people are bagging on

adjusted EPs and the revenue numbers I

get that but I actually really like the

press release and what they did way

better than the earnings call I'm going

to tell you why like this earnings call

uh and I'm just going to be transparent

here and I want to be clear I was I was

pretty bullish coming out of that

earnings like the earnings report I'm

like oh okay all right and you know Elon

Musk is being fair he's like look if you

don't believe in AI don't buy the stock

and and I'm like no no no I believe I

believe I must own the stock but but

then I heard a few things that I didn't

really like and and I'm going to have to

put some thought into these three things

CU these are problematic number

one we just heard that the

4680 probably honestly much like Dojo

isn't actually that revolutionary

product that maybe we thought it was

Bloomberg intelligence just put together

quite a bit of information about how the

4680 it's is much less efficient in

terms of battery density and uh its cost

Effectiveness than Tesla thought or

advertised it would be on their initial

battery day when they released that and

now I'm hearing Elon Musk and the team

basically say well you know batteries

are kind of like memory cards they get

really expensive and they get really

cheap and now nobody else is really

ordering batteries so we could just

order batteries pretty cheaply from

China and we could just use the lithium

ion phosphate batteries why do we really

need to make our own we're really only

doing the 46 80s a for the Cyber truck

which is you know low low volume

production and B as a

hedge okay well that's the same thing we

heard them say about Dojo they were

building out Dojo because they needed to

not because they wanted to and remember

that pessimism we had from Elon about

Dojo I think we just got that same Dojo

pessimism about the 46 80s and I don't

like that it's kind of like every time

we have a different idea like here's

Dojo ah Nvidia is just better here's

4680 ah it's just a hedge I I don't know

I that didn't really Drive well with me

I didn't like that one number two stock

comp is actually an issue Elon Musk just

bluntly told us hey look even if I get

abducted by aliens and I disappear in

other words I don't work at Tesla

anymore we'll still solve autonomy now

when it comes to Optimus uh you know and

it may be becoming a Terminator uh and

if I'm not here and I don't have the

control I I don't know I don't know keep

in mind that earlier in the call he says

hey um I uh I think Optimus is going to

be more valuable than the entire

business put together of everything else

we have and he kind of just implied if

he's not around he ain't going to be

going all in on Optimus at Tesla maybe

it's you know Optimus

I don't know company or whatever

somewhere else or or they just create a

new robot company somewhere else I don't

know that that is a little bit what he

just alluded to I didn't love that and

I'm not saying don't pay the man what he

was promised I'm I I'm not here to talk

about that we've talked about that in

other videos before watch those I'm just

saying that that is a red flag that's

something that we're going to have to

contend with as investors uh and then

we're starting to finally understand

maybe a little bit more where Reuters is

coming from some of the ultra Bulls are

saying ah see Reuters is lying again

Tesla is deciding to come out with more

affordable Vehicles well obviously as

expected we didn't get any kind of

product road map announcement here are

we getting a twoo are we getting a

compact are we getting a van what are we

getting we didn't really get any of that

here we didn't expect that here but when

the team was specifically asked hey are

you just going to do like refreshes or

are you doing totally new models or are

you just going to lower prices and make

your existing Fleet more affordable as

your costs come down which obviously

costs were coming down well we covered

that all in the other video those were

great margins great uh the idea about

getting up to 3 million deliveries in

this earnings call Elon actually went

above that the press release said hey we

want to get close to 3 million vehicles

and elon's like we're going to get to

More Than 3 million Vehicles who knows

maybe they're just not on the same page

and elon's like we're going to start

doing this maybe even at the end of 2024

early 2025 but then when pressed on what

we kind of just got this idea of well

you know we're going to take some

efficiencies of of the new design of a

manufacturing line we'll Implement those

into new and existing vehicles but we

didn't get color on what are they really

new vehicles or they just refreshes I

thought that was a good question from an

analyst I do think there'll be a newi is

vehicle but we just didn't get clarity

on that so that was that was another

sort of negative now there was another

uh negative uh as well and we'll talk

about that in just a moment but I don't

want to be too negative here so I want

to just get some positivity going again

so we talked about cued quarter over

quarter declines and negative free cash

flow maybe being because of seasonality

and just bad timing and if you remove

the Cyber truck from margin you actually

had margin at

18.5% that's actually fan frantastic the

numbers that I'm running are about an

18% margin and things get bullish if I

run up to a 20% margin again so if we

can take out cybertruck and get to 18.5%

margins with tax credits which Tesla is

taking more of since the other man

ufacturers have dipped I'm kind of

optimistic about that that was really

good I like that uh so that was very

good they're obviously making the cars

more affordable by coming out with

attractive financing and leasing uh they

believe they're going to spend about a

billion dollars a year on artificial

intelligence so their capex spend is

still going to be up there uh we did

have uh some talk about The Optimist

being able to do some basic tasks in

their lab right now and maybe they can

sell them externally by the end of the

year that was good that was hope maybe

some limited production by the end of

this year that's cool uh of course

talking about how valuable Optimus would

be in the long term as far as FSD and

Robo taxi did get some clarity that some

states already have approved Robo taxi

sort of networks thanks to weo and Cruz

and that makes it easier for Tesla to

sort of get into those markets and get

started so they actually think

regulatory approval really won't be an

issue especially since they'll be able

to prove that Robo tax us are safer I

agree with them they also gave us a

little bit of color that Tesla will be

able to operate the fleet so Tesla will

take sort of control of the fleet and

you could submit your car to that Fleet

to only allow festar users only allow

friends and family uh or determine when

you want the car back so it's kind of

like Airbnb in your car and there was

even talk about maybe using these cars

and eventually Hardware 5 compute

technology to train uh inference uh you

know calculations Bas well not train

train and inference are the opposite

basically right one leads to the other

but so not train but but to conduct

inference operations in a distributed

manner to basically help functions like

GPT run chat GPT right run using the

car's computers when they're not

operating kind of interesting I don't

know if that's just smok and mirrors but

Elon suggests this would kind of be like

having a distributed AWS from Amazon and

remember they used to be a book company

and now AWS is like the core of the

business right at least the core of the

profit Center that's for sure so these

were all really cool now we did hear

about about this idea about maybe

licensing to another OEM and we got some

clarity on how long that would take

first of all we've heard this story

before we've heard that they're in talks

about OEM licensing before this is the

other negative this is the Q2 earnings

call from

2023 where they say look uh full

self-driving uh here it is and we are

already in discussions with early

discussions with a major original

equipment manufacturer about using Tesla

FSD we're not trying to keep this to

ourselves so they're pretty clear here

like they've said this before this is

the same thing we heard last year except

this time we did hear that even if

somebody did sign a licensing agreement

now which they need to be convinced

first to use the Tesla FSD which they

sort of implied people aren't yet but

they will be uh or hopefully will be

then it would take about 3 years to

actually get Tesla software operating in

other vehicles like a Ford or something

else I thought that was pretty

interesting now something else that I

have to say this was by far one of the

be the best most structured earnings

calls in a while so they did a good job

and they gave us Clarity I don't think

all of that Clarity was all positive so

they definitely took a little bit of

enthusiasm away from that earnings

report but I still am overall probably

net bullish on this earnings report that

I got mostly thanks to what we saw

regarding margins and then the

projections of deliveries as well of of

course a priority on getting the cost of

cars down so we can increase deliveries

that's the core thing that I invest in

Tesla for that's a big deal to me uh so

so I am happy about that uh some other

things to keep in mind uh two

housekeeping things and then we'll get

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at staff ATM kevin.com so can we make

full self-driving transfers permanent no

what's this timeline for scaling the

semi- TR probably late 2025 they did

start grading a field for the Cy or

sorry not the Cyber truck the semi- TRU

for the semi- truck manufacturing uh

facility the gigafactory for the semis I

think that's mostly clickbait I don't

really think that affects my valuation

at all but I think they mostly just

grade it to make sure it doesn't you

know fill up with weeds and the lot

looks like crap I don't actually think

they're going to build that out yet

mostly because they need to make sure

they maintain Capital that they have

right now to efficiently deploy it on

the adjustments to the manufacturing

lines and artificial intelligence as far

as free cash flow again they say there

was sort of a mismatch so maybe they

won't have negative $2.5 billion of free

cash flow again good again we didn't get

clarity on other types of vehicles uh

Elon Musk says don't own the stock if if

you don't believe in a solving autonomy

and uh the latest layoffs were really a

pruning exercise for Tesla uh and that

we just need to get through this hard

time well so again overall I I'm very

optimistic on today I I got pretty

excited about today uh I you know the

Cyber cab that's cool I'm not too sure

that I could really start pricing that

into models for the near term little

bummed about the 4680 though I don't

know how much of a deal that makes for

the stock valuation biggest issue might

be stock comp that could be an issue for

Elon uh and again it makes sense what

we've got going on with that Reuters

article and then yeah it's not a whole

new manufacturing line it's going to be

like an adjusted line uh and maybe maybe

are there going to be new models or they

just going to be more affordable

versions of cars we already have we

didn't get that Clarity Elon said stay

tuned for August 8th for that Clarity

which doesn't surprise me this is elon's

uh only earnings call between now and

the vote on on his stock comp uh and uh

it is also before that August 8th event

so uh with that said thank you so much

for watching this summary really

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as the market maker uh keep in mind I

didn't catch this but apparently uh

Martin has just announced that he is

leaving the company uh today was my

final earnings call with Tesla about a

month ago I spoke with Elon to announce

that I'm going to be retiring from the

world of investor relations and moving

on Wow Martin V taking off as well all

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broker and becoming a stock broker this

video is not personalized advice for you

it is not tax legal or otherwise

personalized advice tailored to you this

video provides generalized perspective

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are either paid affiliations or products

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