Tesla’s (NASDAQ:TSLA) first-quarter earnings call comes on the heels of a surprisingly powerful quarter that saw the electric car maker posting $5.985 billion in revenue and an earnings per share of $1.24, beating Wall Street’s estimates.
As revealed in the company’s Q1 2020 Update Letter, Tesla currently sits on $8.1 billion in cash, which should help the company weather the effects of the coronavirus pandemic. Tesla Model Y production has also outpaced the initial ramp of the Made-in-China Model 3. This is a notable feat considering the fact that Tesla China’s Model 3 ramp is already far quicker than the company’s push for the sedan in Fremont.
For today’s earnings call, Tesla executives are expected to address questions surrounding the company’s plans for the coming quarters, especially amidst the effects of the pandemic. Updates on future projects such as the Cybertruck, Semi, and Roadster may also be mentioned, as well as more details on future Tesla Energy projects.
The following are live updates from Tesla’s Q1 2020 earnings call. I will be updating this article in real-time, so please keep refreshing the page to view the latest updates on this story. The first entry starts at the bottom of the page.
16:36 PT – And that’s a wrap everyone! This earnings call got a bit intense thanks to Elon’s COVID-19 comments, but otherwise, it continued to emphasize that Tesla is well on its way towards optimizing its operations, from its production to the deployment of its new products to consumers.
16:35 PT – Pierre Ferragu from New Street Research asks for an update on Tesla’s gross margins. Kirkhorn stated that when Tesla looks at margins, credits are included. Shutdown inefficiencies in Fremont and Shanghai weighed down Tesla’s margins as well. The CFO did note that Tesla saw strength in gross margins across the board despite lower volumes.
Ferragu follows up with a question on energy storage and how demand is always outstripping supply. As with other battery questions asked during this earnings call, VP of Technology Drew Baglino noted that this inquiry will be addressed on Battery Day.
16:30 PT – Gene Munster from Loup Ventures asks about the Tesla Network and the company’s Robotaxi strategy. Elon states that much testing is needed for such capabilities to be rolled out. Musk discusses how Tesla rolls out its new Autopilot and FSD functionalities. He emphasized that each feature passes through several stages, from simulation to EAP to wide release.
Musk did state that he hopes full functionality of FSD will be released by the end of the year. After this point, it’s just a matter of refining the system. Initial Robotaxi services will likely start with human drivers to supervise the vehicles. But with more data, Tesla can propose a fully-autonomous ride-hailing service to regulators. Musk hopes to accomplish this to some degree next year.
16:20 PT – Ben Kallo of Baird takes the stage. He asks about Tesla’s cell strategy. The answer? Tesla does not have one specific model, though details of this would be discussed on Battery Day.
16:10 PT – Adam Jonas of Morgan Stanley takes the stage. He asks about updates on Tesla’s liquidity this April. CFO Kirkhorn stated that he doesn’t have much color to add, though he emphasized that Tesla has over $8 billion in cash. He also reiterated that Tesla has more inventory now due to the effects of the pandemic.
Elon did admit that he is a bit worried about the Fremont factory’s ongoing shutdown. He reiterates his recent controversial points on Twitter, criticizing the ongoing lockdown procedures in the Bay Area. He did state that it is not only Tesla that is at risk with the ongoing shutdown, as other companies are also in crisis now.
When asked about his message to lawmakers on how to handle the C-19 crisis, Musk stated that he believes people should be allowed to leave their homes. He does this with a number of choice words. These will be very controversial statements.
16:06 PT – Now for a question about Tesla’s plan to move into the residential HVAC business. Musk noted that Tesla actually does this well already with the Model S and Model X, since both vehicles have hospital-grade filters. He also mentioned that Tesla’s HVAC could be all-in-one water creator, hot water heater, and HVAC rolled into one device.
Musk also reiterated the demand for the company’s battery storage solutions. He stated that Tesla has enough demand for its battery storage systems, at least for 2020.
16:00 PT – Next up is the Solar Roof ramp and forecasts for 2021. Elon noted that before COVID-19 shut everything down, Tesla’s Solar Roof ramp was actually seeing a lot of momentum. He remains optimistic about the flagship product nonetheless. “I’m confident that maybe by the end of the year, we may be installing about a thousand a week,” Musk said.
“Demand is good, production is good. The hold up is the installation,” Musk stated, stating that installing the Solar Roof is the hard part, with 1,000 teams installing 1,000 roofs per week.
16:00 PT – Retail investors’ questions from Say are up. Next Giga announcement? Elon says that it will happen within the next three months. He did state that the next Gigafactory will be in the United States. That’s the Cybertruck facility. Perhaps that facility will also produce the Semi? It makes sense considering that Fremont is already at full capacity with Model S, 3, X, and Y.
15:55 PT – Ah, the Battery Day question. Elon states that there will be many exciting news to tell on Battery Day. It will likely be one of the most exciting days in Tesla’s history, Musk stated. The event will likely be held around the third week of May.
As for FSD commercialization, Kirkhorn explained that in North America, Tesla takes about half of the $7,000 FSD cost for revenue while the other half is dedicated for more feature development. Deferred revenue from autopilot a little over $600M as well. Musk notes that there is a tremendous untapped potential for Autopilot and FSD as in-app purchases as well. It looks like the subscription model is indeed happening, at least for existing customers.
15:53 PT – Now it’s the COVID-19 question and how Tesla will come out of the experience. Musk states that Tesla is focusing on investing in improving and developing its products. There is an uncertainty, and there is a bumpy road, but “long-term prospects are extremely good,” Musk noted. Kirkhorn stated that Tesla’s digital nature actually deals with the pandemic situation well, with touchless deliveries and other similar initiatives. “For most people, they would rather go to the dentist than to buy a car… For Tesla, it’s as easy as ordering something from Apple’s app store or Amazon,” he said.
15:50 PT – Next question is China’s subsidies, which the MIC Model 3 does not meet today. Elon announced that Tesla China will be reducing the price of the Standard Range Model 3, allowing the vehicle to meet the requirements of the government’s subsidies. Kirkhorn adds that the cost of producing the vehicle in Shanghai is already lower than the costs of production in Fremont, and there are still opportunities to optimize this further.
15:48 PT – Questions from Say begin. First off is the possibility of FSD subscriptions. Elon states that it makes sense to buy FSD an investment in the future, and Tesla is confident of its long-term value. Kirkhorn agreed, though he stated that a subscription model can allow owners to spread out the expenses for such an option. “Our goal is to do the best thing for customers,” Musk said.
15:45 PT – CFO Zach Kirkhorn takes the stage. He begins by highlighting how the Model Y started with profitability, something that has not been accomplished in the past. Kirkhorn stated that Tesla did not see much effects from the expiration of the federal regulatory credits. Model 3 production in China is going well too.
That being said, Kirkhorn mentioned that Tesla did meet some headwinds. Production inefficiencies still happened, such as with the ramp of Solar Roof V3. The CFO added that Model Y in Shanghai and Berlin are on track, and for now, Gigafactory 3 remains the one factory that is still operating fully.
15:40 PT – Musk also touched on the Model Y’s two-piece casting design, which will make production more optimized while saving weight and cost. He also mentioned the introduction of the Model Y’s heat pump, which helps the Model Y maintain its industry-leading range despite being larger than the Model 3. Musk also stated that the reception to the Model Y from customers has been “universally positive.”
In conclusion, Tesla will be continuing Model Y production at full speed in Fremont, Shanghai, and when it’s ready, Berlin. Musk lightly remarked that this is a forward-looking statement, though he stated that by next year, he believes Tesla can have a capacity of 1 million cars per year.
15:35 PT – Elon Musk states that Tesla was able to make a profit despite the ongoing headwinds in the market and a seasonally soft quarter. Model Y production in Fremont in Q1 was faster than the first two quarters of Model 3 production. The Y is also profitable from launch, something that has not happened before.
Elon also touched on Tesla’s Traffic Light and Stop Sign Control feature. He is very optimistic, stating that the feature is growing at a rapid rate. Each use of the feature trains Tesla’s Neural Net further. “I feel extremely confident that it will be possible to do a drive from your home to your office with minimal interventions by the end of the year,” Musk said.
Musk also spoke about the Model S and Model X range increases. Musk stated that the real Model S test was 400 miles, but the vehicle ended up losing 2% of its range before it was tested. “The true range of the Model S for the past two months is 400 miles. We’re not stopping now,” Musk added.
15:33 PT – Senior investor relations officer Martin Viecha takes the floor. Elon Musk and Zachary Kirkhorn are present. Elon Musk takes the stage with his opening remarks.
15:30 PT – And the call begins, though Tesla seems to be a bit delayed. I’m strangely wondering if the call will be held using Skype or Zoom due to social distancing rules. That would make this earnings call extra interesting.
15:25 PT – T-5 minutes until the earnings call is scheduled to begin. Now it’s just a matter of seeing if Tesla will start in Elon Time V1.0 or Elon Time V2.0.
15:15 PT – It is time once more for Tesla’s quarterly earnings report! It’s pretty amazing that they were able to end the first quarter with a profit. Imagine that. A profit. In the first quarter. With some of it being under a literal global pandemic. The Q1 2020 Update Letter is full of interesting details. Fasten your seatbelts, everyone. This will be very interesting.
Tesla $TSLA Q1 2020 results: Beats on revenue, Model Y sets historic profit on launch https://t.co/0Z5Ym5t4eh
— TESLARATI (@Teslarati) April 29, 2020
Elon Musk
Tesla and SpaceX merger talks hit a new stage, and one hurdle remains
Tesla and SpaceX merger talks are reportedly advancing, and a deal could arrive by December.
Tesla and SpaceX are moving closer to a combination, with a deal announcement possible as soon as December, Bloomberg reported on Thursday, citing people familiar with the matter. The companies have also discussed a scenario in which the announcement slips into early 2027.
Boards and advisers on both sides are now working through the terms of the deal and the governance structure of the combined company, according to the report. One open item is how many SpaceX shares Tesla investors would receive. Bloomberg had previously reported that the two companies were aiming to announce a deal in the first half of next year and close it before the end of President Donald Trump’s term, so a December announcement would pull that schedule forward by months.
Tesla shares rose as much as 1.9% to $398.35 after the report, while SpaceX gained 0.6% to $140.63. SpaceX carries a market value of about $1.9 trillion following its June IPO, and Tesla is valued at about $1.55 trillion, which would make a combination the largest corporate deal on record. Neither company responded to requests for comment.
The talks became official on October 20, when Elon Musk said on SpaceX’s third quarter earnings call that both companies had formed special committees of independent directors to study a merger, as Teslarati reported. Musk said he could not take part because he is “a conflicted party” and called the process “an odd kabuki dance.” He also noted that Tesla would need approval from 50 percent of all outstanding shares, a bar the company missed in 2025 when a board declassification proposal won support from only 39.4 percent.
China remains the biggest structural problem. Bloomberg’s sources said the companies still need to work out how to isolate Tesla’s large and profitable manufacturing business in China from SpaceX’s U.S. government and defense contracts. JPMorgan analyst Rajat Gupta described those two factors last month as “key dynamics that are at odds with each other” for regulatory and shareholder approval. Musk has repeatedly said Tesla has no plans to separate its China business, a position he restated in August after ARK Invest predicted a merger announcement before the end of the year.
Washington adds another layer. Democrats took control of Congress in this month’s midterms and have pledged to investigate Musk’s business and political activities, which could bring added scrutiny to a deal involving one of the Pentagon’s most important launch and satellite contractors.
The report also lands three weeks before Tesla’s December 3 annual meeting at Giga Texas. That ballot has only three items, led by the re-election of Musk, board chair Robyn Denholm and JB Straubel, and includes no merger proposal. Any deal announced in December would likely require a separate special meeting for Tesla shareholders to vote on it.
The two companies already share a growing list of projects, including the Terafab semiconductor plant in Texas. Tesla’s next generation Roadster, which uses cold gas thrusters built on SpaceX hardware, turned up on display at SpaceX headquarters last month and has become one of the clearest public examples of that overlap.
Elon Musk
Nvidia’s board meets on Jensen Huang, and Elon Musk already has an answer
Elon Musk says it would be an honor to hire Jensen Huang amid Nvidia turmoil.
Elon Musk says he would welcome Jensen Huang at one of his companies if Nvidia’s board decides to push out its longtime chief executive.
On Wednesday evening, the financial account ZeroHedge posted “Elon please hire Jensen” on X. Musk replied roughly two hours later: “That would be an honor.” Neither Huang nor Nvidia had responded publicly as of Wednesday night.
Musk’s reply came as Nvidia’s board met to decide Huang’s future. The Wall Street Journal reported that directors were preparing to oust him following reports of two extramarital relationships. One involves Alice Huang, a Singapore-based businesswoman whom U.S. intelligence officials reportedly believe was working for China’s Ministry of State Security. The New York Times separately reported a relationship with Kimberly Powell, Nvidia’s vice president of health care. Huang acknowledged being unfaithful in a memo to employees on Sunday but gave no details.
@zerohedge That would be an honor
— Elon Musk (@elonmusk) November 12, 2026
Under Nvidia’s bylaws, a majority of its 11 directors can remove the CEO with or without cause. Bloomberg reported that the board has been working with an outside firm on possible replacements and may name an interim chief, with CFO Colette Kress seen as the likely pick. Nvidia shares fell more than 8 percent in extended trading, according to CNBC, and the company is scheduled to report quarterly earnings on November 17.
Musk has more riding on Nvidia’s leadership than most tech executives. In August, he told investors on SpaceX’s first earnings call as a public company that it would build its AI infrastructure exclusively on Nvidia hardware, calling Vera Rubin “the best architecture.” SpaceX is also working with Nvidia on the compute payload for Starmind, its planned orbital AI constellation. In October, SpaceX said it had a binding commitment for a roughly $40 billion lease of Vera Rubin GPUs and related equipment, with the leases expected to begin in the first half of 2027.
The scale of that dependence is already enormous. On its Q3 call, SpaceX said it was bringing roughly 200,000 to 220,000 Nvidia GB300 GPUs online each month and expects 2.5 to 3 GW of nameplate compute by the end of the year. That buildout is now reaching new sites like the proposed $24 billion power plant and supercomputer campus at Starbase.
The relationship between the two executives also goes back nearly a decade. Huang has often told the story of personally delivering Nvidia’s first DGX-1 AI supercomputer to Musk in 2016, when no other customer wanted one. “Nobody wanted to be part of it, except for Elon,” Huang said on the Joe Rogan Experience last December.
Musk did not say what role Huang might fill, and his reply stops short of a formal offer. Huang co-founded Nvidia in 1993 and still owns about 3.6 percent of its stock, so any move to a Musk company would depend on whether, and how, he leaves the chipmaker he has run for more than three decades.
Elon Musk
SpaceX’s Anthropic deal has a catch, and Elon Musk just addressed it
Elon Musk says SpaceX’s Anthropic compute deal cuts both ways after Chamath floats higher prices.
Elon Musk pushed back on Sunday against the idea that SpaceX’s compute contract with Anthropic is a one way bet, after venture capitalist Chamath Palihapitiya argued the company could use a termination clause to charge the AI lab far more.
“It works both ways, of course. If compute becomes plentiful and cheap, SpaceX revenue will drop. No crying in the casino for either party,” Musk wrote on X Sunday evening, replying to a clip of Palihapitiya’s comments shared by AI commentator Rohan Paul.
On the All-In podcast released Sunday, Palihapitiya said either side can walk away from the agreement on 90 days’ notice. If data center supply tightens, he argued, SpaceX could exercise that option and bring the contract back at two to three times the current price, and Anthropic would have little choice but to accept. He called it “the kingmaking move,” according to BigGo Finance.
The clause itself is not new. SpaceX disclosed in its IPO filings in May that Anthropic would pay $1.25 billion per month for dedicated capacity at its Colossus clusters through May 2029, nearly $45 billion in total, with both companies able to terminate on 90 days’ notice, as Teslarati reported at the time. SpaceX’s later compute deals with Google and Reflection AI carry similar exit terms.
What has changed is the political backdrop. Palihapitiya’s thesis rests on incoming Democratic governors pulling tax incentives for data centers and slowing new construction. In Texas, Gov.-elect Gina Hinojosa campaigned on a moratorium on new data center approvals, and Deutsche Bank analysts warned last week that SpaceX’s Texas compute capacity could face delays. SpaceX and Tesla shares both fell after the midterm results.
A slowdown would favor companies that already own capacity. SpaceX acquired xAI in February and has been renting data centers to outside AI labs before the space is needed for Grok. At the Baron Investment Conference on Friday, Musk said SpaceX was “getting 50 billion a year for 35 billion dollar investments” and that it can bring a data center online in eight or nine months, compared to two and a half years for competitors. He also said SpaceX is tracking toward an annualized revenue rate above $100 billion in December, with a “best guess” of $500 billion by December 2027.
Musk’s reply points to the other side of the clause. Anthropic has signed large compute agreements with Amazon, Google and Microsoft, and if that capacity comes online faster than new construction slows, the AI lab would have its own leverage to renegotiate or leave. Musk has called Anthropic “obviously currently the leader in AI,” and it remains one of SpaceX’s largest compute customers.
SpaceX shares rose more than 2 percent in overnight trading late Sunday after closing Friday at $134.27, according to Stocktwits.
Tesla Cybercab ownership will come with plenty of strings attached
Tesla Cybercab goes on sale for $29,990, slated for December deliveries
