Investor's Corner
LIVE BLOG: Tesla (TSLA) Q2 2021 earnings call summary
With its second-quarter results that include $11.958 billion in revenue and $1.1 billion of GAAP net income, Tesla (NASDAQ:TSLA) has all but proven that it could be a sustainable business. With Q2 2021 in the bag, after all, Tesla has now posted eight profitable quarters in a row, and that’s despite an ongoing chip shortage and supply chain issues.
As discussed in the company’s Q2 2021 Update Letter, Tesla achieved some milestones in the second quarter. Commissioning has started in some areas of Gigafactory Texas, and Giga Berlin is also moving forward. What’s more, Gigafactory Shanghai has also completed its transition as the company’s primary vehicle export hub. The development of 4680 cells has also moved forward. Even Tesla Energy hit some stride in Q2 2021, with battery storage deployments tripling year-over-year in the second quarter. The same was true for Solar Roof deployments.
The following are live updates from Tesla’s Q2 2021 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.
15:40 PT: And that’s a wrap, everyone! I gotta admit, it’s kind of sad that this may one of Elon Musk’s last regular earnings call appearances. It does make sense, though, as Tesla is in a much better place now compared to before. We can never forget Elon’s most memorable earnings call moments, though. Those will live in Tesla history.
Anyway, thanks for staying with us for our Live Blog once more. Until the next time!
15:38 PT: Elon mentions a number of key tidbits about Tesla Energy. With enough cells, Tesla could hi an annualized production of 1 million Powerwall’s next year. Long-term, Musk also noted that Tesla and its suppliers would have to produce 1,000-2,000 GWh worth of batteries per year.
When asked about the company’s FSD subscription program, Musk highlighted that Tesla has to make the system work very well first. Until then, it would be difficult to forecast just how well FSD would do. “Once we have FSD fully deployed, then the value question will be clear,” Musk said.
15:30 PT: Pierre Ferragu News Street Research inquires about sourcing the company’s 4680 cells. Elon confirms that Tesla is working with its existing suppliers to produce 4680 cells for its vehicles. He also noted that Tesla’s iron-based vehicles will not use 4680 cylindrical cells, as predicted by some of the company’s more ardent bulls. Elon believes it would be ideal to do 1-3 cell formats, especially considering the massive backlog in demand for the company’s product lineup.
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15:25 PT: Rod Lache of Wolfe Research asks about Tesla’s estimates for innovations such as rear castings and 4680 cells. Musk notes that making predictions is difficult. “You need a lot of crystal balls to predict exactly what it would be,” the CEO said. A follow-up question on the company’s advances in cell manufacturing technology was asked. Tesla notes that the company is making progress, but there are still challenges. Tesla notes that more than 90% of the processes have been proven, but things are still limited by the ones that have not been proven. The company, however, is happy with its dry electrode process.
15:20 PT: When asked about other services that Tesla could offer, Elon Musk noted that FSD would be the main service that the company would offer. The CEO did note that Tesla is the leader in electrification and autonomy. This is an accurate statement, regardless of the controversy that surrounds the company.
Investor questions begin. First up is Colin Rusch from Oppenheimer. He asks about the take rates for FSD. Musk notes that it’s not worth promising on this right now, as it’s not meaningful. Tesla is focused on making FSD widely available. The analyst asks about any developments with regulators and their understanding of FSD technology. Musk responds that Tesla does not see a fundamental inhibitor in this light.
Musk reiterates his previous point, noting that once autonomous driving systems are proven to be safer than human drivers, regulators would likely be more welcome. He also reiterates his previous example of elevators, which used to be manual but are now fully automated. The same thing will likely happen with autonomous driving.
15:15 PT: Last retail question for retail investors asked if Elon Musk would be open to interviews every so often on prolific TSLA bulls’ YouTube channels. “I would do it annually,” Musk said, seemingly after pondering the point. He also noted that over time, he would not be speaking in Tesla earnings calls anymore unless there’s something really important that he has to address. Elon would likely only speak during the Annual Shareholders’ Meeting.
15:12 PT: Elon notes that Tesla has a massive amount of equipment that will be coming for the mass production of 4680 cells. “Most likely, we’ll hit an annualized rate of 100 GWh per year by the end of next year,” Musk said.
15:10 PT: A question about the progress of the 4680 cells was asked. Musk noted that in limited volumes, the 4680 cells are reliable enough for vehicles already. It’s just a matter of overcoming challenges that are present when mass manufacturing the 4680 cells. “We will definitely make 4680 reliable enough for vehicles. There are a number of challenges when transitioning from small-scale production to large-scale production,” Musk said. The 4680 cells’ reliability has been validated, though, with cells having been tested for the *equivalent* of 1 million miles.
15:07 PT: A question about Tesla’s plan to open the Supercharger Network to other EVs was brought up. Elon Musk notes that the process would be simple and app-based for non-Tesla owners. He did state that there will be a time constraint. “The biggest constraint to Superchargers is time,” Musk said, adding that there are times when charging stations are packed and other times when they are empty. “Tesla will also be smarter in terms of how it charges for electricity,” Musk added, noting that Tesla will use time-based pricing for non-Tesla EVs.
Non-Tesla EVs would have to use a Supercharger adapter, which Musk jokes would be available on Supercharger Stations. “Our goal is to support the advent of sustainable energy. Our intention is not to create a walled garden that we can use to bludgeon our competitors,” Musk jested. It was also highlighted that opening the Supercharger Network to other EVs would result in the system to grow even faster than ever before.
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15:02 PT: Musk noted that Tesla is looking to strengthen its raw material supply chain. He states that Tesla no longer uses cobalt in its LFP packs, and the company may even shift to iron-based cells in the future as opposed to nickel-based cells. “We expect to have zero cobalt in the future,” Musk said. The CEO added that all stationary energy storage like Powerwalls and Megapacks will use iron-based battery cells.
15:00 PT: The Tesla executive noted that the company plans to overshoot on cell for vehicles and routing cell output to Megapack and Powerwall if there is excess. And just like its present strategy, shortages in cells would likely result in a reduction in the production of the Powerwall and the Megapack.
14:58 PT: Say questions from retail investors begin. First question is about the Cybertruck production. The company noted that it would be looking to ramp Cybertruck production in Gigafactory Texas after the Model Y production starts in the TX-based facility.
Elon Musk highlights the complexity of producing vehicles, and how each EV is comprised of thousands of parts. He notes that Tesla is fastest in history for scaling large manufactured objects, comparable to the Model T. He also noted that the Cybertruck and the Semi’s volume production would be greatly affected by cell availability.
However, Tesla is expecting to see a big boost in cell availability next year. “Maybe not in January,” Musk said, but sometime in the coming year. Musk hints at Tesla having twice as many cells next year compared to 2021. This is impressive considering that this year is already record-breaking.
Seemingly avoiding his typical over-optimistic estimates, Musk emphasizes that these are just current predictions and his estimates could change depending on challenges or obstacles that might come up.
14:53 PT: Musk concludes with a statement about Full Self-Driving, and how he is confident that Tesla could achieve autonomous driving.
Tesla Chief Finance Officer Zachary Kirkhorn takes the floor, noting that the company’s financials even without credits improved substantially. He highlights Tesla’s decreasing ASP while maintaining margins for its vehicles, which was made possible by optimizing the company’s operations to a significant degree.
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The CFO confirms that Tesla’s numbers for the year would be more notable in the third and fourth quarter. “Our 2021 volumes will skew for the second half of the year,” Kirkhorn said.
14:48 PT: Elon discusses the Model Y line in Giga Berlin, which would be different from the Model Ys produced thus far. He still maintains that Giga Berlin and Giga Texas could go live with Model Y production later this year.
“The Model Y line in Texas and Berlin will look mostly like the Model Ys we make, but there will be substantial differences. The Model Y in Berlin will have a cast rear body and cast front body. We’re going to structural packs,” Musk said. The CEO did state that Tesla has a backup plan with a non-structural pack and 2170 cells, but 4680 cells will definitely be used for scale production.
14:45 PT: Musk discusses how Tesla rolled out contingencies to handle the challenges brought about by the chip shortage. He credits Tesla’s team and the company’s suppliers for helping the company resolve the material shortages. The CEO also discusses the release of FSD subscriptions, which would likely have high take rates as the advanced driver-assist system becomes more mature.
Musk notes that he is in Giga Texas, and he congratulates the team building its factories. “There’s nothing a year ago, and there’s a mostly complete large factory a year later,” Musk said, lauding Giga Texas’ team.
14:40 PT: Martin Viecha takes the stage and opens with the basics. Elon and other executives are present for the earnings call. Elon starts his opening remarks. He highlights that Q2 2021 was a record quarter, in deliveries, production, and income. He also noted that electric vehicles are now at an inflection point, and that the market is now being more aware that EVs are the way forward.
14:38 PT: And we’re starting!
14:35 PT: A 5-minute delay is nothing to a Tesla veteran.
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14:30 PT: And here we go. We’re at standby. 🙂 This is very on-character for Tesla.
14:25 PT: Every Tesla bull remembers, after all, those days when TSLA stock was the very picture of volatility. As someone who has watched Tesla over the years, I’m not really sure which one I prefer. The understated consistency of a mature EV maker or the drama and excitement of a disruptor trying to find its wings?
14:20 PT: Strangely enough, Tesla stock has only risen 2.28% despite the company beating Wall Street’s expectations. I wonder if TSLA shares would see a boost in the coming months once more, just like in previous years? Still, it almost feels strange seeing Tesla only move this much after an impressive earnings report.
14:15 PT: Good day, everyone, and welcome to another live blog of Tesla’s earnings call! It’s pretty amazing that just a couple of years ago, there were still big questions whether Tesla could be a sustainable business. Back then, thinking that Tesla would be profitable for a year straight already seemed like a longshot. And now we have eight consecutive profitable quarters. Anyway, we’re 15 minutes away from the Q2 2021 earnings call. Perhaps this will be a memorable one as well.
Don’t hesitate to contact us for news tips. Just send a message to tips@teslarati.com to give us a heads up.
In a new note to investors on Tuesday, Morgan Stanley analyst Andrew Percoco said that Tesla has one big financial question to answer for investors regarding its Robotaxi rollout, Full Self-Driving software, and Optimus.
Percoco said in the note that, for the most part, investors are still very positive about the direction the company is headed. However, there are some things the firm would like to see, and they have to do with financials.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Tesla bulls are more than convinced that the company’s Full Self-Driving software is proof it can develop physical AI. Financially, however, there are still some questions, especially on elevated spending, which CEO Elon Musk said would occur as the company works to roll out Robotaxi faster and continue developing its Optimus robot.
The latter two are where Tesla will have to prove progress to investors, as Percoco writes that both projects “will require clearer evidence that Robotaxi is scaling and more tangible Optimus proof points to support the ROI on elevated capex.”
Percoco said the second quarter earnings call did not change his long-term thesis of where Tesla is positioned in the AI race, which is out in front. However, there are concerns that weaker gross margins and higher R&D spend will stress financials, and that has “sharpened our (and investors’) focus on measurable progress across Robotaxi and Optimus.”
Additionally, Robotaxi still needs to be proven with more operation in existing cities while maintaining safety but improving how many rides it gives in any given time, he said. For Optimus, Percoco wrote that he is “still looking for evidence beyond commentary around SOP.”
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Morgan Stanley put Percoco in charge of covering Tesla after long-time analyst Adam Jonas transitioned to the automotive side.
Currently, Morgan Stanley has a $415 price target on Tesla and a ‘Hold’ rating on the stock. It is trading at around $330 at the time of publication, which was 2:30 P.M. on the East Coast.
SpaceX’s massive investment in AI will make it a big winner, Argus Research said after the company’s successful earnings call last week.
The firm also upgraded shares to a Buy from Hold and set a $160 price target.
SpaceX (NASDAQ: SPCX) is currently recovering from its heavy AI infrastructure investments, as it spent nearly $16 billion in Q2 alone. The company did this primarily by monetizing high-demand GPU compute capacity at a much faster pace than traditional data center economics would suggest.
Company CFO Bret Johnsen said that SpaceX would be able to pay back anything on new deployments within a year.
There are plenty of ways the company can do this:
Leasing excess compute capacity through contracts
SpaceX has already built Colossus and Colossus II, largely for its own model training. However, much of that capacity is already rented out to third parties. It already has major deals with Anthropic, Google, and Reflection AI. These partnerships are adding billions per month to SpaceX’s spreadsheet.
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High utilization driven by industry-wide scarcity
The demand for advanced AI training and inference capacity continues to exceed what is available for use. SpaceX can fill new racks quickly after they come online, so the capital deployed converts into revenue with minimal idle time.
Additionally, management and outside observers have described the new compute capital as behaving more like a cost-of-goods-sold than traditional multi-year capex, especially because of this rapid monetization pattern.
Capacity has already scaled from ~0.4 GW a year to 1.4 GW annually by the end of Q2. There are targets of more than 2 GW by year-end.
High incremental margins on the rental business once capacity is online
GPU cloud providers often operate at strong gross margins. SpaceX can monetize capacity that was already partially built or can be added efficiently. This means that incremental EBITDA margins on the rental revenue are usually high. This accelerates cash recovery relative to the gross capital outlay.
Parallel monetization of its own AI software and applications
Beyond pure infrastructure rental, SpaceX also generates revenue from Grok through subscriptions and usage, from X through ads, data, and other related services, enterprise APIs, and the planned integration of the Cursor coding tools acquisition.
These application layers ride on the same compute infrastructure and provide additional high-margin streams that could offset build-out costs. AI-segment revenue overall rose sharply to about $2.6 billion in Q2, according to Motley Fool. This was driven primarily by the infrastructure contracts, but the software side is also partially responsible.
Efficient, large-scale deployment and vertical integration advantages
SpaceX has emphasized the rapid construction of power and cooling infrastructure and favorable cost-per-megawatt economics relative to industry benchmarks in some disclosures.
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Combined with its ability to scale capacity aggressively and the fact that many contracts start generating revenue within months of capacity coming online, the effective payback compresses dramatically compared with more conventional multi-year data-center projects.
SpaceX’s dominant near-term recovery path will turn the AI clusters into a hyperscale-style compute rental business for other leading AI companies while still using a portion for internal models.
Elon Musk
Another Tesla SpaceX merger prediction by ARK Invest has Elon Musk talking
Elon Musk again denies a Tesla China split as new SpaceX merger speculation resurfaces quickly.
Elon Musk restated that Tesla has no plans to separate its China business from the rest of the company, responding to a new round of merger speculation from ARK Invest.
On the firm’s “Brainstorm” podcast, Cathie Wood’s team, including chief futurist Brett Winton and research director Nick Grous, argued a Tesla and SpaceX combination remains likely, with an announcement possible before the end of the year even if the deal itself would not close that quickly. Winton called Tesla’s Shanghai operations a “small ish wrinkle” for a merger rather than a real obstacle, since SpaceX’s national security work with the U.S. government sits uneasily next to Tesla’s manufacturing base in China.
Musk pushed back on the framing directly. “China is awesome. I strongly encourage people to visit,” he wrote on X. He also repeated language he first used in late July, when the Wall Street Journal reported that Tesla executives had been told to prepare for a possible spinoff, sale, or closure of the China business ahead of a SpaceX tie up. Musk called that report “absurdly fake news” at the time, adding that a separation had “never even come up in a discussion ever,” a line he echoed again this week.
The repeated denial has not settled the underlying question, because Shanghai’s role in Tesla’s business is exactly what makes a merger complicated. Gigafactory Shanghai still ships more than half of Tesla’s global deliveries and functions as the company’s main export hub for Europe and Asia. Teslarati previously reported on Musk’s initial denial, and the merger conversation itself has been building since SpaceX’s IPO gave it public shares to use as acquisition currency.
Wedbush’s Dan Ives has pegged the odds of a Tesla SpaceX merger at 80 to 90 percent by early 2027, and ARK’s prediction of a year end announcement adds another data point to that timeline, even as Musk keeps rejecting the specific mechanics reporters have described. Neither position rules out the other. Musk can deny a China spinoff was ever discussed while analysts still expect some form of combination to move forward, since ARK and Ives are both describing convergence at the corporate level, not necessarily the internal restructuring the Journal described in July.
For now, Tesla’s China business remains intact, and Musk’s comments this week make clear he has no interest in publicly walking that position back, no matter how often the merger question resurfaces.
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Tesla has one big financial question to answer for investors: Morgan Stanley
SpaceX AI investment gamble will make it a big winner, firm says
