Investor's Corner
Elon Musk celebrates ahead of Tesla Q3 earnings with a Gigafactory camping excursion
With all eyes on Model 3 production numbers ahead of Tesla’s third quarter earnings report that’s scheduled to be released on November 1, CEO Elon Musk is seemingly in celebration as he camps on the rooftop of the Gigafactory.
Musk took to Twitter in the predawn hours of Thursday morning to share an Instagram photo of a “Campfire on the Gigafactory roof”. Garbed in his usual dark sports coat that covers a matching crewneck tee, Musk cheers his glass of whiskey while lip-synching to the lyrics of Johnny Cash’s “Ring of Fire” that’s heard playing in the background.
“Whiskey, fire, s’mores and JC” reads the caption to Musk’s Instagram video posted at nearly 3 a.m. in the morning.
Amid a downbeat week for Tesla that’s been fraught with mass firings, lawsuits, a Fremont factory protest, and criticism over Musk’s wild optimism and penchant to overpromise and underdeliver, Musk’s latest social media posts seemingly point to a more positive light that’s about to shine. Are we seeing first signs that Tesla is about to shock Wall Street on November 1 with better than expected results?
The usual high-flying Tesla (Nasdaq: TSLA) stock has seen a drop of roughly 4.5% in October after the company announced that it had produced 260 Model 3s and delivered 220 units in the third quarter – far from Musk’s original guidance of 1,500 Model 3s produced by September.
While it’s still unclear if Tesla has begun to dig itself out of “deep production hell“, recent sightings of Model 3 vehicles bearing VINs in the thousands suggests that the company is starting to step through the ramp portion of its “S-curve”. After all, Musk did share a series of videos in recent weeks that showed Model 3’s production body line in action and body panels being stamped in volume.
The Wall Street Journal recently reported that Tesla has secured a deal with China’s government that would allow the company to set up a factory in the country’s free-trade zone. Having a manufacturing presence in China will strengthen the company’s relationship with the Chinese government, but more importantly help aid mass production and delivery of its products at lower cost in the world’s largest auto market.
Though analysts’ estimates for Tesla’s third quarter revenues suggest that there will be a positive trend in the quarters ahead, Tesla’s gross margin will likely suffer due to costs related to infrastructure development and production ramp. Musk’s goals to produce 500,000 vehicles in 2018 while simultaneously launching a diverse mix of new products seems to be ambitious at this point.
We’ll soon find out if the recent camping excursion on the rooftop of the Gigafactory served as a celebration or just a regular Musk bender.
Stay with Teslarati as we bring you coverage of Tesla’s upcoming Q3 earnings report on Wednesday, November 1 that’s expected to also include a Q&A with Musk.
Updated: Musk took to Twitter to explain the reason for his late night rooftop camp session on the Gigafactory rooftop. “Btw, just want to express a word of appreciation for the hard work of the Tesla Gigafactory team. Reason I camped on the roof was because it was less time than driving to a hotel room in Reno. Production hell, ~8th circle”
https://www.instagram.com/p/BatMhVODF1L/
Tesla stock (NASDAQ: TSLA) closed at an all-time high on Tuesday, jumping over 3 percent during the day and finishing at $489.88.
The price beats the previous record close, which was $479.86.
Shares have had a crazy year, dipping more than 40 percent from the start of the year. The stock then started to recover once again around late April, when its price started to climb back up from the low $200 level.
This week, Tesla started to climb toward its highest levels ever, as it was revealed on Sunday that the company was testing driverless Robotaxis in Austin. The spike in value pushed the company’s valuation to $1.63 trillion.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
It is the seventh-most valuable company on the market currently, trailing Nvidia, Apple, Alphabet (Google), Microsoft, Amazon, and Meta.
Shares closed up $14.57 today, up over 3 percent.
The stock has gone through a lot this year, as previously mentioned. Shares tumbled in Q1 due to CEO Elon Musk’s involvement with the Department of Government Efficiency (DOGE), which pulled his attention away from his companies and left a major overhang on their valuations.
However, things started to rebound halfway through the year, and as the government started to phase out the $7,500 tax credit, demand spiked as consumers tried to take advantage of it.
Q3 deliveries were the highest in company history, and Tesla responded to the loss of the tax credit with the launch of the Model 3 and Model Y Standard.
Additionally, analysts have announced high expectations this week for the company on Wall Street as Robotaxi continues to be the focus. With autonomy within Tesla’s sights, things are moving in the direction of Robotaxi being a major catalyst for growth on the Street in the coming year.
Elon Musk
Tesla needs to come through on this one Robotaxi metric, analyst says
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Tesla needs to come through on this one Robotaxi metric, Mark Delaney of Goldman Sachs says.
Tesla is in the process of rolling out its Robotaxi platform to areas outside of Austin and the California Bay Area. It has plans to launch in five additional cities, including Houston, Dallas, Miami, Las Vegas, and Phoenix.
However, the company’s expansion is not what the focus needs to be, according to Delaney. It’s the speed of deployment.
The analyst said:
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Profitability will come as the Robotaxi fleet expands. Making that money will be dependent on when Tesla can initiate rides in more areas, giving more customers access to the program.
There are some additional things that the company needs to make happen ahead of the major Robotaxi expansion, one of those things is launching driverless rides in Austin, the first city in which it launched the program.
This week, Tesla started testing driverless Robotaxi rides in Austin, as two different Model Y units were spotted with no occupants, a huge step in the company’s plans for the ride-sharing platform.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
CEO Elon Musk has been hoping to remove Safety Monitors from Robotaxis in Austin for several months, first mentioning the plan to have them out by the end of 2025 in September. He confirmed on Sunday that Tesla had officially removed vehicle occupants and started testing truly unsupervised rides.
Although Safety Monitors in Austin have been sitting in the passenger’s seat, they have still had the ability to override things in case of an emergency. After all, the ultimate goal was safety and avoiding any accidents or injuries.
Goldman Sachs reiterated its ‘Neutral’ rating and its $400 price target. Delaney said, “Tesla is making progress with its autonomous technology,” and recent developments make it evident that this is true.
Investor's Corner
Tesla gets bold Robotaxi prediction from Wall Street firm
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Tesla (NASDAQ: TSLA) received a bold Robotaxi prediction from Morgan Stanley, which anticipates a dramatic increase in the size of the company’s autonomous ride-hailing suite in the coming years.
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Percoco dug into the Robotaxi fleet and its expansion in the coming years in his latest note, released on Tuesday. The firm expects Tesla to increase the Robotaxi fleet size to 1,000 vehicles in 2026. However, that’s small-scale compared to what they expect from Tesla in a decade.
Tesla expands Robotaxi app access once again, this time on a global scale
By 2035, Morgan Stanley believes there will be one million Robotaxis on the road across multiple cities, a major jump and a considerable fleet size. We assume this means the fleet of vehicles Tesla will operate internally, and not including passenger-owned vehicles that could be added through software updates.
He also listed three specific catalysts that investors should pay attention to, as these will represent the company being on track to achieve its Robotaxi dreams:
- Opening Robotaxi to the public without a Safety Monitor. Timing is unclear, but it appears that Tesla is getting closer by the day.
- Improvement in safety metrics without the Safety Monitor. Tesla’s ability to improve its safety metrics as it scales miles driven without the Safety Monitor is imperative as it looks to scale in new states and cities in 2026.
- Cybercab start of production, targeted for April 2026. Tesla’s Cybercab is a purpose-built vehicle (no steering wheel or pedals, only two seats) that is expected to be produced through its state-of-the-art unboxed manufacturing process, offering further cost reductions and thus accelerating adoption over time.
Robotaxi stands to be one of Tesla’s most significant revenue contributors, especially as the company plans to continue expanding its ride-hailing service across the world in the coming years.
Its current deployment strategy is controlled and conservative to avoid any drastic and potentially program-ruining incidents.
So far, the program, which is active in Austin and the California Bay Area, has been widely successful.
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