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Businesses The Almighty Buck News Technology

Tesla Posts Second Profitable Quarter Ever (bgr.com) 136

anderzole writes from a report via BGR: Tesla on Wednesday posted its earnings report for the quarter gone by and investors will have a lot to cheer about. While analysts on Wall St. were expecting Tesla to post a loss, Tesla during its September quarter actually posted a profit, and an impressive profit at that. When the dust settled, Tesla posted a quarterly profit of $22 million and EPS of $0.71. Revenue for the quarter checked in at $2.3 billion. Illustrating how impressive Tesla's performance was this past quarter, Wall St. was anticipating Tesla to post a loss amid $1.9 billion in revenue for the quarter. As far as deliveries are concerned, Tesla during the quarter boasted that it achieved record vehicle production, deliveries and revenue. More importantly, Tesla reaffirmed via a shareholder letter that the Model 3 is still on track for a late 2017 release. You can read Tesla's shareholder letter here.
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Tesla Posts Second Profitable Quarter Ever

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  • by Anonymous Coward on Wednesday October 26, 2016 @07:59PM (#53158585)

    To not forecast the profit very accurately, is a sign that the business is not in control.

    • To not forecast the profit very accurately, is a sign that the business is not in control.

      Of course, businesses are not in control. They're subject to what happens in the world around them, just like everybody else.

      • Of course, businesses are not in control. They're subject to what happens in the world around them, just like everybody else.

        ...which they drive with envelopes filled with money delivered to congresscritters. Just like everyone else can.

        Oh.

        Wait...

      • Which is why a former employer would let contract workers go for the last couple of months of the year, so it could make its numbers. Then, come January, a lot of those people got brought back. They were really a good choice; they already knew the computer systems they had been working on.

        It's not the best possible thing for *actual* shareholder value, but apparently Wall Street doesn't pay much attention to the actual business, just numbers that relate to the actual business, and calls the numbers deriv

    • by Anonymous Coward

      I would imagine that the outcome didn't take them by surprise.

      But when looking ahead, you have to plan for the worst.

    • Yes - making and selling more product than you "forecast" and therefore making more profit is a horrible, horrible thing! How dare you piss on the God of Forecast?
      • I didn't say it was horrible - but it is not what forecasting is supposed to do. Investors have more confidence in a business that is under control.
    • by khallow ( 566160 )

      To not forecast the profit very accurately, is a sign that the business is not in control.

      What makes you think they didn't forecast the profit accurately? Public guidance is not forecasting and it is traditional to guide low.

      • A little bit low!
        • by khallow ( 566160 )
          They are, actually. There's not much difference between the supposed forecast and the reported profit. It's something like $40 million different in profit on $2.3 billion in revenue.
  • Letter also indicates they installed a 20MW/80MWh battery at SCE's Mira Loma substation. (I think there is a 100 MW gas peaking plant there too though...)

    Would be impressive if it wasn't for the fact that Edison was the only place I ever saw Solyndra solar cells before. (Looking at the installation, no wonder they went bankrupt...)
    • by Rei ( 128717 ) on Wednesday October 26, 2016 @09:41PM (#53159017) Homepage

      Solyndra was a bet that silicon prices would remain high. It was a way to get more power out of less silicon. The bet was wrong. With the drop in price in silicon, their death was inevitable. They also had a weird design decision, going for the concentrator. It made sense (in the economics of the time) to go for either concentrators or CIGS, but not both.

      That said, the government took way too much flak - politically motivated - over Solyndra. With any diverse profile of startup investments, you expect some to fail. Economists analyzing the ARRA post-facto have been by and large given it quite positive evaluations for its effects on the economy. The loans program office had already wiped out the Solyndra loss just two years later.

      • The problem with the Solyndra system I saw was the white roof was a dark grey due to dirt and dust, and it had been washed down a few days before our visit. Agree on the political aspect... but I think they were so screwed up that success was never likely.
      • Bingo. When Solyndra was formed (and to be honest, my company at the time made process equipment for CIGS deposition), solar grade polysilicon was in short supply, and was spiking in price to almost $600 per Kg. Investment in thin film amorphous silicon cells (Applied Materials and Oerlikon bet heavily here too) and CIGS (CuInGaSe) cells as the solution. Until the wild growth of the solar cell industry, spot prices for polysilicon was ~$30 - $50 Kg (from memory, all sites that have historical data seem to d

      • The loans program office had already wiped out the Solyndra loss just two years later.

        The loan program was actually profitable for the government. [csmonitor.com]

  • Wow, less than a 1% return on investments. Hell, I make several times that in my investments.

    • And how old are the funds in which you invest? Most are older than Tesla, I'd imagine. Give 'em a few years. There will be a tipping point soon, and they've got a good position to take advantage.
    • by Rei ( 128717 )

      Are your investments undergoing literally exponential production and sales curves? Are you unaware that scaleup costs tremendous amounts of money?

  • The real story: (Score:4, Interesting)

    by Anonymous Coward on Wednesday October 26, 2016 @09:16PM (#53158935)

    Tesla changes their accounting methods. Dumb money is excited that TSLA is profitable. Smart money has no idea what to make of these numbers but know something smells musky.

    As far as I can tell (Yes, I am a forensic accountant) they sold a lot of now-obsolete cars at a big discount and did some other tricks to prop up sales and push Q4 revenue into Q3, Q3 expenses into Q4, etc.

    Now, it really doesn't matter if they're profitable or not because they have plenty of money in the bank and $22 million is a rounding error. Except Tesla is trying to buy Solar City. Why? Basically to bail out Elon Musk since Solar City is a turd circling the drain and Elon has a lot of money tied up in it (directly and indirectly through his other company, Space X). A lot of Tesla stock holders recognize this shit for what it is. But if Tesla can eek out a profit, dumb money thinks Elon is a fucking genius and let him buy up Solar City.

    • by Okian Warrior ( 537106 ) on Thursday October 27, 2016 @02:50AM (#53159789) Homepage Journal

      Tesla changes their accounting methods. Dumb money is excited that TSLA is profitable. Smart money has no idea what to make of these numbers but know something smells musky.

      As far as I can tell (Yes, I am a forensic accountant) they sold a lot of now-obsolete cars at a big discount and did some other tricks to prop up sales and push Q4 revenue into Q3, Q3 expenses into Q4, etc.

      Now, it really doesn't matter if they're profitable or not because they have plenty of money in the bank and $22 million is a rounding error. Except Tesla is trying to buy Solar City. Why? Basically to bail out Elon Musk since Solar City is a turd circling the drain and Elon has a lot of money tied up in it (directly and indirectly through his other company, Space X). A lot of Tesla stock holders recognize this shit for what it is. But if Tesla can eek out a profit, dumb money thinks Elon is a fucking genius and let him buy up Solar City.

      I just want to point out that the OP is:

      1) Claiming to be a forensic accountant
      2) online
      3) as AC.
      4) Framing his position in emotional terms (dumb money, smart money)
      5) While showing no specifics. (Tesla changed accounting methods? Using nebulously-defined "tricks"?)
      6) For a company whose analysis is largely partisan.

      I don't know why people bother reading up on Tesla, news and analysis is all over the map. Price points from $150 to $400 per share, negative/positive outlooks, baldfaced lies about specs, dangers, and recalls, and all absolutely certain of their analysis.

      It's almost as if there are large groups of people who would personally benefit from Tesla's success or failure, and who are willing to lie and mislead to bring about that result.

      • by AmiMoJo ( 196126 )

        Nobody knows what to make of them. Car reviewers don't know how to review electric vehicles, and end up making cringe-worthy statements or obvious n00b mistakes while not presenting any of the really valuable information buyers need as a result. The markets are the same, e.g. no other mass market car company has ever sold so many pre-orders so far from production and before a finished model has even been shown, and they don't know how to value it.

    • As far as I can tell (Yes, I am a forensic accountant) they sold a lot of now-obsolete cars at a big discount and did some other tricks to prop up sales and push Q4 revenue into Q3, Q3 expenses into Q4, etc.

      From electrek [electrek.co] reporting on the Q3 Statement:

      The automaker disclosed that it expects to also be profitable next quarter

      If Tesla's right about Q4, and your theory on changing their accounting methods is correct, then they would have had to pull next year's Q1 revenue back to Q3+Q4 and/or push Q3+Q4's expenses to next year. Your theory is appearing unlikely. Or perhaps you're wrong and they're actually just making money.

    • Glad you pointed to the proof of this. Oh wait...

  • by silentcoder ( 1241496 ) on Thursday October 27, 2016 @02:59AM (#53159837)

    Amazon still hasn't had one.
    So I would advice backing SpaceX over whatever Bezos's rocket company is called.

    • Amazon still hasn't had one.

      Huh? Amazon has had many profitable quarters. It's had five straight and the next quarterly report (to be announced today) is expected to show a profit as well.

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