Tesla is Now a Typical “Car Company,” Bernstein Analyst; “We Dug Our Own Grave,” Elon Musk
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"Hoist(ed) by its own petard," say Tesla bears. And, after yesterday's bleak earnings release and a disastrous earnings call, the bears are out in full force today for their victory lap.
Translation to plain English:
Tesla's stock (TSLA) rose by 1.4%. However, they fell short in their third-quarter adjusted earnings per share, reporting $0.66 compared to the expected $0.72. Their automotive gross margin, excluding regulatory credits, was 16.1%, whereas 17.7% was…
— Annonymous Programmer (@unnamed_coder) October 18, 2023
There was quite a lot to digest yesterday. Tesla failed to meet consensus analyst expectations regarding its top-line and bottom-line metrics, hammered by a steep drop in its auto gross margin (ex-Regulatory Credits), which declined from 26.7 percent in Q3 2022 to just 16.3 percent in Q3 2023. Given the deep additional price cuts that Tesla has instituted in several key markets this quarter, such a decline is only logical.
Source
Surprisingly, while Tesla's ex-RC Average Selling Price (ASP) fell by 18.1 percent on an annual basis, the company's Cost of Goods Sold (COGS) metric for its auto stores decreased by just 4.8 percent.
Most people I spoke with tonight thought the $TSLA earnings call was not good to terrible. Lot of excuses about macro, new CFO seemed unsure, no answer to question have auto gross margins bottomed, $25K car should be highest priority, didn’t address the question why not buy down…
— Gary Black (@garyblack00) October 19, 2023
Nonetheless, it was the earnings call, beset by a still-green CFO and a somewhat paranoid CEO, that unleashed the true horror for
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