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Two points. One is that you have to look at the trends over the years, not just quarterly ups and downs, and there Tesla is doing remarkably well. But by far t

Two points. One is that you have to look at the trends over the years, not just quarterly ups and downs, and there Tesla is doing remarkably well. But by far the more important point is that the EV revolution is finally taking off. Thanks to Tesla's example and plunging battery prices (down %35 in the last year alone), a whole bunch of EV's are going to come on the market in the next few years. And sticker price for the larger ones is predicted to match ICE's around 2023, and keep falling after that. This is going to turn the auto industry upside down, and be a huge step in saving the environment. So don't focus so much on Tesla, look at the larger trends.

dragontamer 8y ago
> Two points. One is that you have to look at the trends over the years, not just quarterly ups and downs, and there Tesla is doing remarkably well. https://fairlyvalued.com/company/TSLA https://fairlyvalued.com/company/TSLA Tesla has NEVER posted a yearly net income in its entire life. Q1 2019 is quite a bad start, with another $700 Million loss to start this year. That's the trend: losing money by any measurement on a yearly basis. Free Cash flow? Negative. Net Income? Negative. Etc. etc. > This is going to turn the auto industry upside down, and be a huge step in saving the environment. So don't focus so much on Tesla, look at the larger trends. Tesla lost 1.5 Billion this quarter and is down to $2.2 Billion in cash. A capital raise is absolutely necessary to prevent this company from going bankrupt. I mean, I wanna stop global warming as much as you do. But an unsustainable business model is doomed to fail. This company needs to start making a profit (and not just a quarterly non-GAAP profit... I mean a real GAAP profit measured on a yearly basis)
- windexh8er 8y ago
  > I mean, I wanna stop global warming as much as you do. But an unsustainable business model is doomed to fail. This company needs to start making a profit (and not just a quarterly non-GAAP profit... I mean a real GAAP profit measured on a yearly basis) So many darlings don't ever post profits though. Palo Alto Networks is a prime example. They've never posted a GAAP profit, ever. Yet... It trades at ~38x and the stock has rocketed over the years. Non-GAAP reporting is a racket and should be illegal.
  - dragontamer 8y ago
    Fair enough. But there's a big difference between losing 127 million / year like Palo Alto networks, and losing 700 million / QUARTER like Tesla just did. Yes, 700 million gone in one quarter.
    - windexh8er 8y ago
      The amount is only relevant if it's a trend or unfounded. I know it's en vogue to be a Tesla naysayer, however they have posted profits previously. My point was that with Palo Alto Networks they have zero quarters of profit over 25+ quarters. And, while they are the example I chose, they're very much not alone.
      - deleted 8y ago
        [deleted]
      - dragontamer 8y ago
        This isn't a software company. Tesla is a car company with only ~15% gross margin. It wasn't ONLY Tesla that lost a bunch of sales last quarter. Across the board, Toyota, Ford, GM, and more have been closing factories and preparing for an incoming slowdown in sales. Car sales are well known to be cyclic: people only buy new cars when they need a car... and we're entering the cycle where most people don't need a new car. A ~70,000 cars delivered quarter (like Q1 2019) results in a loss of $700,000,000. Tesla can only do this maybe 4 or 5 more times before they completely run out of cash (depending on how many capital raises / additional debt they take on. They currently only have $2.2 Billion, so their cash-burn currently extrapolates to a little over ~3 quarters !!). And general economic conditions make it look like things are getting worse, not better, for Tesla and the general car industry. > My point was that with Palo Alto Networks they have zero quarters of profit over 25+ quarters. When you're spending $1 Billion/year on sales/marketing, and losing $100 Million/year, you have a sustainable business. Palo Alto Networks is profitable as long as they drop their marketing expenses just slightly (~10% less marketing). I'm willing to give Palo Alto Executives the benefit of the doubt: that their marketing costs are worth the debt. Its also not a very big loss: Palo Alto Networks can sustain this net-loss for another 10+ years (Cash on Hand is ~1 Billion, and they are losing only ~100 million/year) Tesla on the other hand has... like 7 quarters... at the current burn rate. And unlike Palo Alto Networks, there's no easy solution in their financial sheets: Tesla's financial statements look relatively lean, no fat in there and yet they are unable to consistently make a profit.
- woodandsteel 8y ago
  The reason Tesla doesn't post yearly profits is it is still in start-up mode, so it doesn't sit back and maximize profits from what it has developed so far, but charges ahead into new areas. Look at all it has going on now: it is working on the semi, model y, and a pick-up truck, doing a renewal of the S and the X, working like crazy on self-driving, developing solar tiles, and building a gigafactory in China.

dragontamer 8y ago

> Two points. One is that you have to look at the trends over the years, not just quarterly ups and downs, and there Tesla is doing remarkably well. https://fairlyvalued.com/company/TSLA https://fairlyvalued.com/company/TSLA Tesla has NEVER posted a yearly net income in its entire life. Q1 2019 is quite a bad start, with another $700 Million loss to start this year. That's the trend: losing money by any measurement on a yearly basis. Free Cash flow? Negative. Net Income? Negative. Etc. etc. > This is going to turn the auto industry upside down, and be a huge step in saving the environment. So don't focus so much on Tesla, look at the larger trends. Tesla lost 1.5 Billion this quarter and is down to $2.2 Billion in cash. A capital raise is absolutely necessary to prevent this company from going bankrupt. I mean, I wanna stop global warming as much as you do. But an unsustainable business model is doomed to fail. This company needs to start making a profit (and not just a quarterly non-GAAP profit... I mean a real GAAP profit measured on a yearly basis)

windexh8er 8y ago
> I mean, I wanna stop global warming as much as you do. But an unsustainable business model is doomed to fail. This company needs to start making a profit (and not just a quarterly non-GAAP profit... I mean a real GAAP profit measured on a yearly basis) So many darlings don't ever post profits though. Palo Alto Networks is a prime example. They've never posted a GAAP profit, ever. Yet... It trades at ~38x and the stock has rocketed over the years. Non-GAAP reporting is a racket and should be illegal.
- dragontamer 8y ago
  Fair enough. But there's a big difference between losing 127 million / year like Palo Alto networks, and losing 700 million / QUARTER like Tesla just did. Yes, 700 million gone in one quarter.
  - windexh8er 8y ago
    The amount is only relevant if it's a trend or unfounded. I know it's en vogue to be a Tesla naysayer, however they have posted profits previously. My point was that with Palo Alto Networks they have zero quarters of profit over 25+ quarters. And, while they are the example I chose, they're very much not alone.
    - deleted 8y ago
      [deleted]
    - dragontamer 8y ago
      This isn't a software company. Tesla is a car company with only ~15% gross margin. It wasn't ONLY Tesla that lost a bunch of sales last quarter. Across the board, Toyota, Ford, GM, and more have been closing factories and preparing for an incoming slowdown in sales. Car sales are well known to be cyclic: people only buy new cars when they need a car... and we're entering the cycle where most people don't need a new car. A ~70,000 cars delivered quarter (like Q1 2019) results in a loss of $700,000,000. Tesla can only do this maybe 4 or 5 more times before they completely run out of cash (depending on how many capital raises / additional debt they take on. They currently only have $2.2 Billion, so their cash-burn currently extrapolates to a little over ~3 quarters !!). And general economic conditions make it look like things are getting worse, not better, for Tesla and the general car industry. > My point was that with Palo Alto Networks they have zero quarters of profit over 25+ quarters. When you're spending $1 Billion/year on sales/marketing, and losing $100 Million/year, you have a sustainable business. Palo Alto Networks is profitable as long as they drop their marketing expenses just slightly (~10% less marketing). I'm willing to give Palo Alto Executives the benefit of the doubt: that their marketing costs are worth the debt. Its also not a very big loss: Palo Alto Networks can sustain this net-loss for another 10+ years (Cash on Hand is ~1 Billion, and they are losing only ~100 million/year) Tesla on the other hand has... like 7 quarters... at the current burn rate. And unlike Palo Alto Networks, there's no easy solution in their financial sheets: Tesla's financial statements look relatively lean, no fat in there and yet they are unable to consistently make a profit.
woodandsteel 8y ago
The reason Tesla doesn't post yearly profits is it is still in start-up mode, so it doesn't sit back and maximize profits from what it has developed so far, but charges ahead into new areas. Look at all it has going on now: it is working on the semi, model y, and a pick-up truck, doing a renewal of the S and the X, working like crazy on self-driving, developing solar tiles, and building a gigafactory in China.