aaaaaaand rugged.... Tesla Stock

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of me Kevin if you want a bundle wow we

actually got a bingo this time in fact

we got Bingo twice now we'll go through

everything that was just said in the

Tesla earnings report the Tesla earnings

call uh we'll talk about the good the

bad and uh well let's just get right

into it okay first things first when it

comes to earnings yeah they they they

miss okay Tesla's missed six out of the

last eight times so making the bet that

Tesla's probably not going to do super

well was probably the right bet in fact

it is probably why the stock basically

sold off going into earnings in the

first place at the time of recording

this in the postm market it is down 5%

and our next FIB retracement does leave

us with a 175 in sight which isn't is n

great we're looking like we're going to

open below 200 tomorrow so you're below

a psychological threshold will that lead

people to buy the dip who knows we'll

find out but what were the numbers

well again adjusted DS missed by 2 cents

coming in at 71 cents versus 73 free

cash flow Beats at 2.06 billion versus

the 1.45 expected gross margin missed

with

17.6% versus the 18.1% expected and X

credits we came in at

17.2% we've got this summary over here

at eack I will say there is still no

bottom in margin it is worth noting that

production costs came down 3.2% from the

last quarter we've been seeing price

declines come down but it's worth

balancing those price declines with the

fact that lithium prices have been

plummeting which is good but you know

that's just one component here and we

want to potentially see lithium prices

come back down or continue to come down

but we also want to see cost Savings in

other areas which we are seeing and is

probably why we've been seeing these

cost declines here really it's a way of

saying hey there's deflation in

manufacturing whether that's coming from

Innovation or that's coming from cheaper

uh commodity prices or it's coming from

both for example going to a 48 volt

architecture system and the massive

reduction in need to use copper is one

of the ways that you could actually save

money however we are coming to a limit

in terms of how much of a reduction you

could actually get or expect from uh

Tesla's uh production cost we're coming

up to about a

$36,000 cost per vehicle Tesla calls

that a limit so imagine that is sort of

this line that's hitting this 36,000 uh

limit the uh analysts and Executives in

the calls did sort of indicate that oh

there's still more we can do don't worry

I'm not sure if they were just saying

that because they're sad the stock is

down uh keep in mind this full update

totally for free over on ec.com and uh

we also have a big house hack update

that's out so when you're done watching

this go check out that house hack update

a little scary but also exciting when it

comes to the realate market uh anyway no

production estimate given for 2024 this

is in the bingo card and in uh the

actual call we got nothing bingo card

earnings call nothing the only thing we

heard is that uction would be lower for

2024 but we didn't hear how much lower

just lower just interesting and kind of

annoying that we had no guidance at all

some of the comments regarding uh or

some people were commenting that the

Next Generation Investments could be why

production might actually maybe even go

as far as negative below the 1.8 uh 1

million vehicles per year I don't think

that's true Elon did make it cleared

that Q4 is growing uh production at uh a

rate close to 2 million but then again

close to I guess 1.8 is close to 2

million but Elon did start off by saying

that hey we're close to 2 mil he's very

very excited about the nextg platform

calls it uh remarkable revolution in

manufacturing one that will be uh uh

first tested out in Giga Mexico however

they won't conduct any product

announcements here and then they will

only build Giga Mexico after they tested

out the manufacturing in Giga Texas

which means you're going to have the

manufacturing line tested out Giga Texas

probably late 25 then in 2026 you'll

probably get to Giga Mexico and we'll

probably announce a third Giga uh

location for the NextGen platform at the

end of 2024 or early

2025 which really means for us to

actually price in the Next Generation

model we're probably looking at uh mid

this year before you actually start

pricing that in stock market usually

tries to price about 18 months ahead so

18 months ahead does put us at about

June July before we start pricing in the

Next Generation platform the ramp of the

Cyber truck is expected to be longer and

slower than uh other models the model 3

being threeyear hell as Elon says with

the model y being slightly easier since

borrowed a lot from the model 3 no

mention on the earnings call of solar

deployment those solar deployments

substantially negative 33% uh to the

negative uh in q1 of 2023 flat Q2 - 26%

Q3 those are all sequentially mind you

which is not great another 16% down in

Q4 operating margin appears to have

bottomed at 7.6% now up at

8.2% storage grew 2 and A2 uh 2.25 times

in 2023 but did fall to 19 1.5% uh or

did fall 19 1.5% in Q4 from Q3 so some

kind of sequential slowdown there in

solar and batteries not great in the

near-term 4 end phase roughly $29

billion of cash 24ish billion in debt SL

payables 6.3% growth in superchargers

quarter over quarter installed vehicle

uh capacity is flat at about 2.35

million so it looks like we'll probably

be producing slight LLY below the

installed capacity other things that we

are looking at is uh uh basically saying

look we can't predict what gross margins

are going to do the company's obviously

still got pretty good gross margins at

17.2% X credits that's pretty remarkable

but without that real growth which they

say is really driven by interest rates

it's hard to say what margins are going

to do Elon says if rates come down

quickly margins will go up if rates come

down slowly margins won't go up as fast

pretty straight straightforward shows

you that Tesla is an interest rate

sensitive company in my opinion that can

still mean recession resilient but not

interest rate resilient very big

distinction that's very important

company talking about being between two

major growth waves essentially a way of

saying hey we're going to be at a little

slower period of growth that is we may

have been growing at you know 40 to 50%

da da da then we hit a little bit of a

trough and that's hoping to set up for

the next scurve

uh actually downplayed Optimus here I

was pretty surprised not Optimus Dojo

was downplayed I was pretty surprised

with how much Elon Musk downplay Dojo he

called it a high potential high risk or

sorry it a project that has potential

but that is high risk High payoff and

that it's potentially a long shot

without a high probability of actually

occurring uh this is why they're

undergoing with a dual path approach to

figuring out uh artificial intelligence

which is basically a way of saying like

we're all in on Nvidia while at the same

time all in

on uh uh Dojo at the same time

interesting way to put it uh and I do

think that downplays Dojo quite a bit

more than I expected they are about to

complete version three of Tesla's

Hardware that uh worth noting is uh not

uh that's actually Hardware 5 that's

because they started with mobile ey then

Nvidia and then three versions of Tesla

Hardware they are uh not seeing any

interest in other companies uh in the

scope of full self-driving licensing

even though elon's open to that we're

not seeing anybody actually bite on it

he seems to think that other people

don't think it's real yet which I agree

why I think they ought to you know

consider advertising how beautiful that

full self driving is but they might get

inou Trouble With The Regulators if they

do that laob facility is adding another

production line expected to double its

capacity for battery packs from 10 20

gwatt hours to 40 inbound logistic costs

are coming down they're optimizing and

negotiating on Advertising they have run

digital targeted uh campaigns to drive

awareness education however the biggest

issue they still see is affordability

they are trying to address

misconceptions of EVS on safety and

affordability but everything ultimately

comes down to and they don't want to

overspend on Advertising uh by the way

if I haven't made it clear yet I'm back

to doing stock market open live streams

they're just on a different Channel

they're on the meet Kevin uh Market open

live stream channel it's linked down

below if you hit notifications on that

or just subscribe to it you'll just see

it every morning the Market's open at

5:25 a.m. uh and then of course this

complete summary including our bingo

card is available at ec.com you'll see

the link down here you'll see the video

stream with all the live information and

you'll also be able to scroll through

and see some other updates here from

employees let go eack Red Sea talk

Taylor Swift whatever asml Texas

Instruments some cool information here

on ec.com totally for free totally free

service for free forever uh well some of

the things that I was surprised that did

not get mentioned uh I was surprised we

didn't I I wasn't really surprised we

didn't get anything on Uber or a van but

I was surprised that we did not get any

Red Sea commentary we did get Bingo

twice boom boom

Elon did walk back the 25% stock comp he

mentioned this is not to get economical

25% control it's simply he wants more

voting control and he thinks he can

accomplish this with a dual class of

share that's that he believes Tesla's on

the path to creating an AI and Robotics

Juggernaut and he doesn't uh he doesn't

want to control it but he also uh

doesn't want so little influence that I

could be voted out by some random share

older holder he argues uh so we did not

see any comments on a solar bottom no

talk about a van or Uber no talk about

further price Cuts nominal talk about

the charging Network so I I left that

one unchecked no production numbers

which was really surprising no Union

talk no audible puff of a joint no

mention of digging our own grave no

mention about crypto no mention of Earth

as a market no uh

whatever Frameworks over here uh no

insulting an analyst uh some of these

things were slightly de eii wasn't

mentioned some of these may have been

mentioned but would have been relatively

nominal I can't remember if he mentioned

production as hard or some of these so

it's possible at some of these others I

wasn't paying attention to as much but

anyway uh the ones that were very clear

of course they have an excess supply of

4680 this was very interesting plenty of

4680 and they think they're going to

sell out cyber trucks for 2024 based on

how many people are converting off the

weit list obviously there's a loss in

that but they think they're going to do

eventually up to 250,000 cyber trucks a

year they did not give a production

Target for how many they produced last

year or how many they're looking for

this year they uh did mention twice the

most valuable company in the world

comment uh interest rates were

complained about project Redwood was

talked about AI day was briefly talked

about although Elon was a little bit

concerned other companies are just

copying everything that they're doing so

uh as far as the actual stock well I

mean not a surprise the sucker's down

and missed this is what's supposed to

happen in earnings the company the stock

is not as down as much uh as I thought

it would have been though who knows

sometimes after these calls are done it

plummets even more they did talk about

how Optimus is extremely revolutionary

but some of the executives sort of

argued like hey well you know does it do

anything you useful and there was like a

little bit of a back and forth there

between the exec and Elon where's like

yeah yeah it already does useful stuff

yeah stock almost down 6% now so you are

getting a bleed the implied volatility

was 6% so uh we'll see if how puts end

up printing tomorrow uh if they do at

all since we're not past 6% yet the the

stock could end up falling more tomorrow

who knows I do think on a technical

basis with this bad news out of the way

I do think that 175 is a pretty safe

floor no guarantees but I've been very

clear that when we failed this breakout

here and earnings were coming up 175

well well 221 was easy but 175 was a

possibility and so we are on a nasty

downtrend right now so you do have some

potential near-term pain uh however I do

think as usual after earnings you get a

few days of down and then you do

potentially have the opportunity for for

Tesla play some catchup to uh the market

essentially being at all-time highs look

at how different those stock charts are

that's the NASDAQ for you that's Tesla

pretty embarrassing Tesla stuck in that

wedge there but uh it is an interest

rate sensitive stock whereas companies

propping up the NASDAQ right now like

Nvidia are anything but interest rate

sensitive in fact uh Tesla's Opex

spending is heavily going into a company

like Nvidia I think any if anything here

of this Tesla earnings called reiterated

uh what we have on uh nvidia's dominance

in AI the fact that Elon downplay Dojo

is quite frankly one of the

strongest uh pushes you could see for

NVIDIA like Elon basically just handed a

win to Nvidia there so I have to give

Nvidia a big high five on that one uh so

I still I'm still personally of this

dual track mindset where you can have

chip exposure that's not personal

financial advice obviously but chip

exposure that's uh Nvidia AMD asml Intel

uh TSM you get your chip exposure and

then potentially you equal weight that

with energy and Tesla so that might be

like an end phase in Tesla those two are

your anchors right now once those two

rally that's a goodlook portfolio but

right now you've got one that's crushing

it one that's sucking kind of hurting

the portfolio a little bit but I think

it's just a matter of time of when

interest rates go down where you get the

slingshot even if you get a correction

on chips you get that slingshot on

energy that creates a pretty good-look

portfolio the question is when is the

time to enter those and quite

frankly nobody knows anyway with that

said make sure you go to ec.com to read

the full summary and all of the other

news that we've got and go check out the

update that we posted at the house Hack

YouTube channel or hous hack Twitter

you'd also follow me on Twitter at real

me Kevin or house hack homes on YouTube

or Twitter X whatever uh and see the

full update of what my startup is doing

how we uh probably doubled the valuation

of the company NeXT fundraising updates

and more thanks so much do not advertise

these things that you told us here I

feel like nobody else knows about this

we'll we'll try a little advertising and

see how it goes congratulations man you

have done so much people love you people

look up to you Kevin PA there financial

analyst and YouTuber meet Kevin always

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