- Tesla’s forecast deliveries of 7,500 vehicles in Q2, including 200 leased vehicles, should give it top-line hypothetical revenue of roughly $804 million.
- With a 25.5% gross margin on sales, hypothetical gross profit should come in at about $205 million.
- Non-GAAP research and development costs are expected to ramp by 30% to $88.4 million.
- Non-GAAP selling, general and administrative expenses are expected to ramp by 15% to $111.7 million.
- Therefore, Q2 hypothetical earnings are likely to be less than $5 million, or about $0.04 per share, compared with current consensus estimates of $0.27 per share.
In contrast to earlier calls when Mr. Musk was a paragon of self-confidence, he seemed a little more cautious as he gave an overview of "seal engineering" problems that have pushed the launch date of the long overdue Model X into Q2-15, maybe.
While Mr. Musk spoke in glittering generalities of Tesla's potential in China, he seemed painfully aware of the problems and costs of creating charging infrastructure in mega-cities where single family homes with three car garages are a rarity and there are only one-fifth as many millionaire families we have in the States.
The more surprising discussion was a subtle but important shift in the gigafactory description. While the trial balloon was originally floated as massive vertical integration project that would have rivaled Ford's River Rouge plant in its capability and complexity, it seems to be rapidly morphing from proprietary vertical integration project into an "an industrial park" where Tesla will make modules, Panasonic will make cells if the two companies can come to an agreement, and other unnamed companies will make "anodes cathodes, separators, electrolytes and so forth," assuming they all come to suitable agreements. While my innate skepticism runs deep, it certainly sounds like the gigafactory is a long way from being a done deal.
The most surprising discussion dealt with the distinction between demand in the US and deliveries in the US. While a couple of analysts tried to drill down for more granular data the esteemed Mr. Musk was positively evasive on the topic.
I'm intrigued by the disclosure that the estimated cost of installing underbody armor on approximately 30,000 copies of the Model S that were manufactured before March 9th will only be $2 million, or about $67 per car. Color me skeptical.
I may have more observations after Tesla's Form 10-Q is filed with the SEC, but this will give readers something to chew on in the interim.