Tesla Q2 Call Wrap Up: Musk Jabs At Apple, Questions Full Self Driving, Says He Won’t Be On Future Calls
As we reported yesterday after hours, Tesla released Q2 results that largely beat analyst estimates.
Revenue $11.96B, beating the est $11.36B
Adjusted EPS $1.45, beating the est 97c
Free Cash Flow $619M, beating the estimate of a Negative $319.1M
Automotive gross margin 28.4%, beating the estimate of 25.0%
Cash and cash equivalents of $16.229BN, missing the estimate $16.55 billion
With the financials out, all eyes were on the ensuing conference call, which – despite not being quite as absolutely insane as some past conference calls – still offered up some commentary and information that wasn’t included in the the company’s Q2 report.
First, the lede: Elon Musk admitted on the conference call that he may not be attending future calls. By our estimation, the lack of mumbling through incoherent jargon could and half-truths could shave dozens of minutes off of future calls, keep them far more coherent and make them far less of a legal liability.
“I will no longer default to doing earnings call. Obviously I’ll do the annual shareholder meeting, but I think that going forward I will most likely not be on earnings calls…” Musk said. He continued, stating he wouldn’t reappear on calls “unless there’s something really important that I need to say” to which a MarketWatch opinion piece hilariously responded:
Earlier, “important” things Musk had to say in earnings calls included describing public-health restrictions during the COVID-19 pandemic as “fascist,” calling a Wall Street analyst “boneheaded” in a rant, and saying he wasn’t looking for his highly valued company to be too profitable. Those are the kinds of performances no investor should miss.
“Elon Musk says he is done with regular appearances on earnings calls. Tesla Inc. and its investors should be thankful,” MarketWatch wrote.
Could this be a sign that adults – or maybe even regulators – are finally starting to get the ear of Elon Musk?
Also of note on the call was Elon Musk taking jabs at Apple not once, but twice. Recall, Apple’s Titan vehicle project is being head up by Doug Field, who spent five years with Tesla.
First, Musk took exception with Apple’s use of cobalt mining: “Apple uses I think almost 100% cobalt in their batteries and cell phones and laptops, but Tesla uses no cobalt in the iron-phosphate packs, and almost none in the nickel-based chemistries. On on a weighted-average basis we might use 2% cobalt compared to say, Apple’s 100% cobalt. Anyway, so it’s just really not a factor.”
Musk then took a shot at Apple’s “Walled Garden”, which is a term used to describe how strict the company is with what software can be installed on its iPhones.
“I think we do want to emphasize that our goal is to support the advent of sustainable energy. It is not to create a walled garden and use that to bludgeon our competitors which is used by some companies.” According to CNBC, for those who didn’t get his reference, Musk then faked a cough and said, “Apple.”
Speaking of Musk creating liabilities for the company with what he says on conference calls, toward the end of the call Musk addressed Full Self Driving in a manner that made it sound like the non-existent product that he has been charging customers for over the last half decade still doesn’t work.
“Yeah. I mean, any given price is going to be wrong, so we’ll just adjust it over time as we see the value proposition makes sense to people. So we’re just really — I’m not thinking about this a lot right now. We need to make Full Self-Driving work in order for it to be a compelling value proposition. Otherwise, people are betting on the future,” Musk said.
It’s a stark tacit admission that Full Self Driving doesn’t work and that Musk may be coming around to the idea that “betting on the future” may be Musk-code misinterpreted by pesky regulators to mean “I’ve been selling people a product for a half decade that doesn’t exist”.
Musk ended the call by continuing to question the value proposition of his own software: “Like right now, does it makes sense for somebody to do FSD subscription? I think it’s debatable,” Musk said.
That was pretty amazing.
Also worth keeping in mind that he said FSD would be able to do a coast to coast autonomous drive… FOUR YEARS AGO.
It still doesn’t work, is nowhere close to working, and can’t be transferred between owners or if you buy a newer Tesla.
— ben k (@Benshooter) July 26, 2021
Tue, 07/27/2021 – 08:02
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