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> They make money on cars (gross margin) No they don't. Net operating cashflow has been hugely negative for their entire existence and there is no conceivable

> They make money on cars (gross margin) No they don't. Net operating cashflow has been hugely negative for their entire existence and there is no conceivable path to profitability. Tesla is a taxpayer subsidized wall street scam that is going to blow up sooner or later.

mikeash 11y ago
Net operating cashflow is negative because they're piling money into expansion. Their gross margin is about 25%. If they wanted to be profitable in the short term all they'd have to do is stop spending money on expansion and just pull in the sweet profits from current sales.
msandford 11y ago
> No they don't. Net operating cashflow has been hugely negative for their entire existence and there is no conceivable path to profitability. Sure they do. They're just always spending it elsewhere, like Amazon. Amazon doesn't sell products at a loss, their prices have become much less competitive over the years. But the lack of profitability at Amazon isn't because the various business units are all operating at a loss. It's because the older units which make a profit finance the new ones that are starting up and not profitable yet. Telsa may well be taxpayer subsidized and it may blow up. But on 2014 revenue of 3.2b the odds that they're cooking the books are vanishingly small.
krschultz 11y ago
Even if you include R&D into the COGS they make a profit on each car sold. Here is Q4 2014 - http://www.bloomberg.com/research/stocks/financials/financials.asp?ticker=TSLA http://www.bloomberg.com/research/stocks/financials/financia... $3.2B total revenue $2.3B COGS $0.4B R&D $0.5B gross profit including R&D Their net income for Q4 2014 was -$0.3B, so they're not nearly as far off from profitability as you make it sound.
CamperBob2 11y ago
Tesla is a taxpayer subsidized wall street scam that is going to blow up sooner or later. As opposed to any car that runs on petroleum? That's not taxpayer-subsidized at all, I suppose.

mikeash 11y ago

Net operating cashflow is negative because they're piling money into expansion. Their gross margin is about 25%. If they wanted to be profitable in the short term all they'd have to do is stop spending money on expansion and just pull in the sweet profits from current sales.

msandford 11y ago

> No they don't. Net operating cashflow has been hugely negative for their entire existence and there is no conceivable path to profitability. Sure they do. They're just always spending it elsewhere, like Amazon. Amazon doesn't sell products at a loss, their prices have become much less competitive over the years. But the lack of profitability at Amazon isn't because the various business units are all operating at a loss. It's because the older units which make a profit finance the new ones that are starting up and not profitable yet. Telsa may well be taxpayer subsidized and it may blow up. But on 2014 revenue of 3.2b the odds that they're cooking the books are vanishingly small.

krschultz 11y ago

Even if you include R&D into the COGS they make a profit on each car sold. Here is Q4 2014 - http://www.bloomberg.com/research/stocks/financials/financials.asp?ticker=TSLA http://www.bloomberg.com/research/stocks/financials/financia... $3.2B total revenue $2.3B COGS $0.4B R&D $0.5B gross profit including R&D Their net income for Q4 2014 was -$0.3B, so they're not nearly as far off from profitability as you make it sound.

CamperBob2 11y ago

Tesla is a taxpayer subsidized wall street scam that is going to blow up sooner or later. As opposed to any car that runs on petroleum? That's not taxpayer-subsidized at all, I suppose.