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LIVE BLOG: Tesla (TSLA) Q2 2024 earnings call

Credit: Tesla

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Tesla’s (NASDAQ:TSLA) Q2 2024 earnings call comes on the heels of the company’s Q2 2024 Update Letter, which was released after the closing bell on Wednesday, July 23, 2024. 

Tesla posted total revenues of $25.5 billion, with automotive revenues of $19.878 billion in the second quarter. The company also posted non-GAAP earnings per share of $0.52 and GAAP EPS of $0.42 for Q2. Tesla posted $1.6 billion GAAP operating income after restructuring charges of $600 million in the second quarter as well.

The following are live updates from Tesla’s Q2 2024 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. 

17:30 CDT: That’s a wrap! Thanks for reading and following along with our Live Blog! ‘Til next quarter!

17:27 CDT: Potential Trump Presidency could end IRA, and would Tesla have negative implications if IRA is ended, an analyst asks. Musk mulls the question and says “It would have some impact, but it would be devastation to our competitors.” Musk believes getting rid of the IRA would have minimal impact on Tesla. He continues to hound the point that Tesla’s value is highly reliant on autonomy and says if an investor does not believe the company will solve self-driving, they should sell their stock.

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17:18 CDT: Musk breaks down the ride-sharing platform, highlighting the advantages: the vehicle could be used 24/7, and could be a full-time member of the vehicle fleet or a part-time contributor. Vehicle owner will share revenues with Tesla directly.

Rollout questions from Pierre Ferragu of New Street Research are met with confusion from Musk. “Every car will be capable,” as Ferragu asked if the early rollout of Robotaxi would be geofenced and small-scale.

17:14 CDT: Musk says GM canceled its self-driving, pedal-less, wheel-less vehicle was canceled because “it’s not up to par.” He says GM blamed regulators instead of being transparent about their self-driving efforts. “GM can’t make it work.”

17:12 CDT: Musk says Supervised FSD will come to China, Europe, “and other countries” upon the release of v12.6. It will submit regulatory approval when those versions are rolled out

17:04 CDT: Alex Potter of Piper Sandler asks about FSD licensing — “Can you elaborate on the mechanics of how this would work?” Potter asks if it would be “plug-and-play” or would OEMs have to adopt Tesla platform.

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Musk confirms hardware would have to be upgraded: cameras and gateway with cellular and Wi-Fi capability would be required. “…it will be several years before we see this in volume,” Musk says. The CEO also adds that disclosure would depend on who the OEM licensing FSD is, and a volume minimum would be required.

16:59 CDT: Ben Kallo of Baird asks about the automotive revenue balance and how it will be impacted by AI. Musk says Optimus will likely be more of a contributor to company revenue than all other parts of the business combined. Musk believes 22 million units of humanoid robots will be demanded by customers worldwide, with Optimus leading the way. “We have all the ingredients; I think we are unique in having all of the ingredients [when it comes to humanoid robots],” Musk said. He also mentions ARK Invest’s analysis when factoring in AI and robotics.

Gigafactory Mexico is “paused” until after the election. Tesla will ramp up production at its existing factories.

16:58 CDT: Musk says he doesn’t want to give any details about future vehicles after an analyst question because it could cannibalize near-term sales.

16:53 CDT: Musk says Grok will make its way into Tesla vehicles at some point.

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16:52 CDT: Does Tesla feel it is cheating people from the joy of owning a Tesla because it doesn’t advertise? Simply put, no. More people in Q1, 66% of deliveries were to people who never had a Tesla before

16:51 CDT: Optimus accessories question gets a chuckle from Musk and Co. No real update given by the team.

16:49 CDT: Musk says NVIDIA’s execution is “impressive” as he talks about Dojo. More effort on Dojo is needed to ensure training capability needed, Musk says. “We do see a path to being competitive with NVIDIA with Dojo,” he adds. “We kind of have no choice because the demand for NVIDIA is so high; it’s obviously their obligation to raise the price of GPUs to whatever the market will bear…We’ve really got to make Dojo work, and we will.”

16:47 CDT: A question regarding the 4680 production cell ramp yields Tesla to reveal 51 percent more cell production in Q2 than Q1. More than 1400 Cybertrucks worth of 4680 cells each week. The first validation Cybertruck with the dry-cathode process has been built. Tesla says it’s on track to launch dry-cathode in Q4, lowering costs for widespread cell production.

16:42 CDT – Tesla’s CFO takes the stage. Like Musk, he also extended his thanks to Tesla’s team for pulling through in the second quarter. The executive highlighted that Tesla is offering extremely competitive finance rates worldwide, so the best time to buy a Tesla is right now.

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He also emphasized the fact that Tesla’s vehicles are the most American cars on the market today. “We pride ourselves as a company with the most American-made cars.” He also noted that “Our focus is to provide the most compelling products at the most competitve price.”

16:39 CDT – The CEO noted that the Tesla Robotaxi is now planned for an unveiling on October 20. The delay in the vehicle’s unveiling is due to changes that he asked for the vehicle.

As for Optimus, Tesla expects several thousands of humanoid robots produced and performing useful tasks at the company’s facilities by next year. Optimus Version 1 will start limited production by next year, Musk estimated.

Musk also highlighted that Tesla Energy is growing at an incredible pace. Tesla Energy may also double or triple production with both the company’s Lathrop and Shanghai Megafactories.

16:35 CDT – Elon Musk takes the stage for his opening remarks. He acknowledges that there is now more competition in EV market. He also noted that competitors have rolled out discounts on EV prices, which has been a bit challenging for Tesla — but not in the long term.

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Despite these challenges, Musk thanked the Tesla team for achieving record revenues this past quarter. The CEO noted that Tesla would not get too deep into its product road map in the earnings call, though he did note that a more affordable model unveiling is expected in the first half of 2025.

Musk also highlighted that FSD is seeing a lot of progress, with version 12.5 having 5x the parameters of 12.4. He encourages Tesla owners to try out FSD. “Full Self-Driving will be a massive demand driver,” Musk said.

16:30 CDT – Tesla’s Q2 2024 earnings call begins — on time(!) The company’s new IR Head takes the stage. Elon Musk and other Tesla executives are present.

16:26 CDT – And the music starts. Here we go! Or rather, the actual waiting starts now.

16:20 CDT – Tesla stock is down 4.27% as of writing. This is not a small drop by any means, though it is more tempered than the drops from previous quarters. As per Barron’s, Tesla shares have moved an average of 11% over the past four quarterly reports.

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16:15 CDT – Hello, everyone, and welcome to our live blog of Tesla’s second quarter 2024 earnings call. Tesla’s second quarter results are quite mixed, with the company beating estimates for revenue but falling short of expectations in earnings per share. Tesla also reported $1.6 billion GAAP operating income in Q2 after restructuring charges of $600 million. Elon Musk and Tesla’s other executives would likely provide some context on the company’s Q2 results in the upcoming earnings call.

Here’s the livestream of Tesla’s Q2 2024 earnings call.

Don’t hesitate to contact us with news tips. Just send a message to simon@teslarati.com to give us a heads up.

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Investor's Corner

Tesla investor Calpers opposes Elon Musk’s 2025 performance award

Musk’s 2025 pay plan will be decided at Tesla’s 2025 Annual Shareholder Meeting, which will be held on November 6 in Giga Texas.

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Credit: Tesla China

One of the United States’ largest pension funds, the California Public Employees’ Retirement System (Calpers), has stated that it will be voting against Elon Musk’s 2025 Tesla CEO performance award. 

Musk’s 2025 pay plan will be decided at Tesla’s 2025 Annual Shareholder Meeting, which will be held on November 6 in Giga Texas. Company executives have stated that the upcoming vote will decide Tesla’s fate in the years to come.

Why Calpers opposes Musk’s 2025 performance award

In a statement shared with Bloomberg News, a Calpers spokesperson criticized the scale of Musk’s proposed deal. Calpers currently holds about 5 million Tesla shares, giving its stance meaningful influence among institutional investors.

“The CEO pay package proposed by Tesla is larger than pay packages for CEOs in comparable companies by many orders of magnitude. It would also further concentrate power in a single shareholder,” the spokesperson stated.

This is not the first time Calpers has opposed a major Musk pay deal. The fund previously voted against a $56 billion package proposed for Musk and criticized the CEO’s 2018 performance-based plan, which was perceived as unrealistic due to its ambitious nature at the time. Musk’s 2018 pay plan was later struck down by a Delaware court, though Tesla is currently appealing the decision.

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Musk’s 2025 CEO Performance Award

While Elon Musk’s 2025 performance award will result in him becoming a trillionaire, he would not be able to receive any compensation from Tesla unless aggressive operational and financial targets are met. For Musk to receive his full compensation, for example, he would have to grow Tesla’s market cap from today’s $1.1 trillion to $8.5 trillion, effectively making it the world’s most valuable company by a mile. 

Musk has also maintained that his 2025 performance award is not about compensation. It’s about his controlling stake at Tesla. “If I can just get kicked out in the future by activist shareholder advisory firms who don’t even own Tesla shares themselves, I’m not comfortable with that future,” Musk wrote in a post on X.

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Investor's Corner

Tesla enters new stability phase, firm upgrades and adjusts outlook

Dmitriy Pozdnyakov of Freedom Capital upgraded his outlook on Tesla shares from “Sell” to “Hold” on Wednesday, and increased the price target from $338 to $406.

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Credit: Tesla China

Tesla is entering a new phase of stability in terms of vehicle deliveries, one firm wrote in a new note during the final week of October, backing its position with an upgrade and price target increase on the stock.

Dmitriy Pozdnyakov of Freedom Capital upgraded his outlook on Tesla shares from “Sell” to “Hold” on Wednesday, and increased the price target from $338 to $406.

While most firms are interested in highlighting Tesla’s future growth, which will be catalyzed mostly by the advent of self-driving vehicles, autonomy, and the company’s all-in mentality on AI and robotics, Pozdnyakov is solely focusing on vehicle deliveries.

The analyst wrote in a note to investors that he believes Tesla’s updated vehicle lineup, which includes its new affordable “Standard” trims of the Model 3 and Model Y, is going to stabilize the company’s delivery volumes and return the company to annual growth.

Tesla launches two new affordable models with ‘Standard’ Model 3, Y offerings

Tesla launched the new affordable Model 3 and Model Y “Standard” trims on October 7, which introduced two stripped-down, less premium versions of the all-electric sedan and crossover.

They are both priced at under $40,000, with the Model 3 at $37,990 and the Model Y at $39,990, and while these prices may not necessarily be what consumers were expecting, they are well under what Kelley Blue Book said was the average new car transaction price for September, which swelled above $50,000.

Despite the rollout of these two new models, it is interesting to hear that a Wall Street firm would think that Tesla is going to return to more stable delivery figures and potentially enter a new growth phase.

Many Wall Street firms have been more focused on AI, Robotics, and Tesla’s self-driving project, which are the more prevalent things that will drive investor growth over the next few years.

Wedbush’s Dan Ives, for example, tends to focus on the company’s prowess in AI and self-driving. However, he did touch on vehicle deliveries in the coming years in a recent note.

Ives said in a note on October 2:

“While EV demand is expected to fall with the EV tax credit expiration, this was a great bounce-back quarter for TSLA to lay the groundwork for deliveries moving forward, but there is still work to do to gain further ground from a delivery perspective.”

Tesla has some things to figure out before it can truly consider guaranteed stability from a delivery standpoint. Initially, the next two quarters will be a crucial way to determine demand without the $7,500 EV tax credit. It will also begin to figure out if its new affordable models are attractive enough at their current price point to win over consumers.

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Investor's Corner

Bank of America raises Tesla PT to $471, citing Robotaxi and Optimus potential

The firm also kept a Neutral rating on the electric vehicle maker, citing strong progress in autonomy and robotics.

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Credit: Tesla

Bank of America has raised its Tesla (NASDAQ:TSLA) price target by 38% to $471, up from $341 per share.

The firm also kept a Neutral rating on the electric vehicle maker, citing strong progress in autonomy and robotics.

Robotaxi and Optimus momentum

Bank of America analyst Federico Merendi noted that the firm’s price target increase reflects Tesla’s growing potential in its Robotaxi and Optimus programs, among other factors. BofA’s updated valuation is based on a sum-of-the-parts (SOTP) model extending through 2040, which shows the Robotaxi platform accounting for 45% of total value. The model also shows Tesla’s humanoid robot Optimus contributing 19%, and Full Self-Driving (FSD) and the Energy segment adding 17% and 6% respectively.

“Overall, we find that TSLA’s core automotive business represents around 12% of the total value while robotaxi is 45%, FSD is 17%, Energy Generation & Storage is around 6% and Optimus is 19%,” the Bank of America analyst noted.

Still a Neutral rating

Despite recognizing long-term potential in AI-driven verticals, Merendi’s team maintained a Neutral rating, suggesting that much of the optimism is already priced into Tesla’s valuation. 

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“Our PO revision is driven by a lower cost of equity capital, better Robotaxi progress, and a higher valuation for Optimus to account for the potential entrance into international markets,” the analyst stated.

Interestingly enough, Tesla’s core automotive business, which contributes the lion’s share of the company’s operations today, represents just 12% of total value in BofA’s model.

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