Earnings Call Summary | Tesla Q2 2023 [in 11 Minutes] $TSLA Stock

well here's a summary of the Tesla

earnings call and some of the additional

juice and not juice that we got out of

the Tesla earnings call first we didn't

hear the word advertising used once

still no commentary on Advertising

though we are starting to see meet Tesla

advertisements that's pretty cool anyway

uh Elon Musk started out by uh giving us

a heads up that they're going to be some

Q3 shutdowns for upgrades he started off

with that and also ended on it because

as soon as he was asked for more detail

elon's like let's just move on from this

this is asking for a level Precision we

don't have and then uh they're like oh

we're actually out of time bye that was

after the stack was down like four

percent meanwhile it actually started

the earnings call flat so the juice of

the earnings call that really drove it

down was elon's reiteration that hey we

would rather sell more cars than focus

on margin that's kind of the opposite of

what a lot of Tesla investors were used

to in years prior where the focus was

let's get to 30 percent margin yeah

we're making so much money on the cars

now elon's like no let's get to FSD and

make money on that but the stock market

isn't convinced by FSD yet though we did

get some juicy updates for example we

got this update that there will be a

one-time amnesty opportunity in the

third quarter to be able to transfer FSD

from a car that you currently own to a

new vehicle sort of a one-time reward to

existing members that basically means if

you bought a Tesla say in 2007 or sorry

2017 and you have FSD on that and now

you want to upgrade to a new Tesla you

would be able to transfer what you paid

for in that old vehicle

to the new vehicle it's pretty cool uh

Q3 is July through September so TBD for

details on that also surprised they made

an announcement on that here obviously

the stock market is going to be readily

obsessed with Tesla's margin future

however Elon made it very clear that is

a short-term focused uh Outlook that we

should be focusing on the long term and

that in the future Elon sees a path to a

10x or maybe a 5x for Tesla stock and a

Tesla's valuation so another thing that

was quite interesting was this idea that

Elon wouldn't be focused on dojo if they

could just get their hands on enough

Nvidia chips huge shout out there to

Nvidia and uh not maybe the nicest pat

on the back to the dojo team because

it's sort of like a we only have you

because we can't get enough of them

let's just say if you're the dojo

girlfriend you're a little like uh

really

anyway uh this uh by the way previously

Elon Musk has been sort of anti these

FSD transfers because obviously that's

where he sees that margin boost

also uh this came as an announcement

through the Tesla earnings call Tesla is

in discussions to license full

self-driving to a major OEM OEM is

original equipment manufacturer that

would be like a company like Ford and GM

so Elon Musk has had discussions with

them over the past a few discussion or

weeks here uh even conducting Twitter

spaces with the CEOs of those companies

so potentially one of those

this is nearly free margin though you're

going to have a lot of Tesla fans who

are like no I want to be the only FSD

out there on the road or others are

saying well that's going to take years

to deploy but the reality is FSD

licensing doesn't necessarily have to be

here's full self driving it could

literally be as simple as here's

autopilot now just you know wobble your

you know whatever stock you've got in

your vehicle twice and boom you've got

FSD on could be something that could

happen actually pretty quickly or I

shouldn't say FSD autopilot on an

autopilot for most cases is it does most

of the work and is absolutely phenomenal

big fan of autopilot I've been using it

since about 2017 and it would be a

massive upgrade to a lot of the Adas

that companies currently have for their

sort of Lane keep and all that the

autopilot's just substantially better

easier to use easier to set up way fewer

buttons to press I mean you're going

boom boom and it's on as opposed to you

know setting your speed and and trying

to adjust your cruise distance and

enabling this you're not sure if it's on

or off it's a disaster I've tried 8as

too many times in some of these other

cars and they're just terrible so uh

anywho that'll be quite interesting to

see which company ends up announcing

that and it could actually open the door

to a lot of FSD revenue or just even

autopilot licensing Revenue that is

essentially free margin now of course

there is some risk of vehicle

cannibalization here that okay well if

somebody can buy a Ford with autopilot

why buy a Tesla although I'm not

entirely sure that the person who's

buying a Ford is interested in buying a

Tesla anyway so I'm not convinced that's

a big problem in fact I would say this

is a massive net positive especially if

you could just start with autopilot then

you might be able to use existing

cameras and sensors and not have to

integrate you know Tesla cameras and

sensors you just apply autopilot

software and slowly collect more

training data for not just these other

vehicles but the entire FSD system big

fan of it Cybertron continuing to build

release candidates we actually saw Tesla

stock drop about one percent on Elon

talking about continuing to build

release candidates which is just a

suggestion that they're still working on

this they're not actually in production

yet they're still sort of in that

tooling and testing phase so you saw

Tesla drop about a percent on that

tooling and testing phase for cyber

truck even though we still expected this

here saw Tesla drop percent to a percent

and a half on talk that maybe margin

isn't that important even though Elon

says Hey demand sort of matches uh

production which is where we want to be

yeah there's still that potential hint

that maybe price Cuts could come in the

future though they really danced around

that not as much optimism as you would

have previously heard on previous

earnings calls cell production 80 up 80

for 4680s from q1 that's great uh some

talk about uh the resident or the value

of solar deployments being a little

based on uh what kind of you um uniform

regulation you get throughout the

country not too optimistic there on

Commodities they continue to see some

improvement as well as improvement from

the inflation reduction act and then of

course able to balance out their working

capital needs a little bit better

helping keep free cash flow up which is

great there was some joking about how

isn't it great that we can make all of

our own sh9it and still be free cash

flow positive very true too but again a

lot of talk about margin margin margin

to the point where Elon was starting to

get frustrated about this focus on

margin suggesting that hey you know you

should focus on the company Long Term

and not short-term but unfortunately

uh the stock market cares about that

sort of data excuse me even though Elon

uh it feels highly confident uh in

Tesla's value long term he reiterated

his more margin warning uh you probably

don't want to take on a margin loan

during manic depressive or volatile or

turbulent times in the stock market a

little bit talk on the Optimus about how

they're about 10 Optimus robots at

various different stages of production

right now a little bit of bragging about

Giga casting about how great it is that

they can make little micro adjustments

to Casting using inserts and they have

to replace these inserts anyway as they

do wear out over time uh but that they

can then make easy and micro adjustments

to Casting inserts to modify uh their

production as needed and a little bit of

bragging about how they were able to

potentially by Leading by example now

encourage other people and other

companies that is to copy the casting

model about Austin and Berlin you're

still seeing model y builds that are a

bit pricier than per unit than what it

costs to build them in other places like

Shanghai or Fremont

uh stock is down almost five percent now

of four four and a half percent my

expectation was that uh there's there

was a chance that you would get to a

downside of somewhere around uh let's

see here if we jump on over to the fibs

we can actually just show the fibs on

screen here there we go 258 was sort of

that downside that I was looking for uh

that would be a bad report looks like

right now we're kind of bobbling around

here in the 278 level not bad that's a

modest adjustment down uh that bounce

that rejects us basically off this

longer term Trend that we've been on and

puts us back to the ceiling and previous

rejection levels where we've been of

somewhere around the 279 level maybe

that 285 level some volatility there

before getting to the 258 level but uh

yeah some some negativity here likely

driven by margin uh uh you know nonsense

basically about the uh brushing off

questions about margin

uh we're getting super charging

obviously a very exciting that you've

got so many companies adopting the nacs

uh North American charging standard

cyber production they're the highest

units per hour uh is what they're

expecting for any vehicle production

ever so they really think they can

systematize the Cyber truck production

pretty incredibly which should help with

margin as well though nobody even knows

what the Cyber truck is going to sell

for so some things to pay attention to

for uh cyber truck

the uh there will be a lot of obviously

uh institutional analysis over the next

day or so that's going to affect how

Tesla stock ends up moving the little

shutdown there at the end though about

uh getting to the weeds of the Q3

production shutdown was it something

that left I think investors with a lot

of optimism that Q3 is supposed to be

better

but oh well uh so overall I'd say you

know

benign earnings report uh some cool

announcements on the FSD transfers and

FSD licensing but really dodgy on margin

suggesting you know margin is going to

be something we're still dealing with

for the next few quarters we did get

commentary on hey we just got to get

through basically the next few quarters

and then we'll be basically Off to the

Races with how many cars we're able to

sell especially when we get into an

interest rate falling environment so

this gives you a little bit of a summary

on what happened on the earnings call

nothing here that I would say is scary

but uh definitely nothing super exciting

to where God is coming down with bags of

cash to make the company substantially

more profitable so overall I'd say kind

of what you would expect a little bit of

a give back on the rally that we've

gotten for Tesla nowhere near as bad as

it could have been though so I would

walk away from this overall kind of like

all right four or five percent give back

on stock after that no problem

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