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Wow! we actually got a bingo this time. In fact, we got Bingo twice. Now we'll go through everything that was just said in the Tesla earnings report. the Tesla earnings call.

uh, we'll talk about the good, the bad, and uh. well. let's just get right into it. Okay, first things first, when it comes to earnings, yeah, they they they miss.

Okay, Tesla's missed six out of the last eight times. so making the bet that Tesla's probably not going to do super well was probably the right bet. In fact, it is probably why the stock basically sold off going into earnings in the first place. At the time of recording this in the postm market, it is down 5% and our next FIB retracement does leave us with a 175 in sight which isn't is n great.

We're looking like we're going to open below 200 tomorrow, so you're below a psychological threshold. Will that lead people to buy the dip? Who knows, we'll find out. But what were the numbers? Well again adjusted DS Missed by 2 cents coming in at 71 cents versus 73 free cash flow Beats at 2.06 billion versus the 1.45 expected gross margin missed with 17.6% versus the 18.1% expected and X credits we came in at 17.2% We've got this summary over here at Eack: I Will say there is still no bottom in margin. It is worth noting that production costs came down 3.2% from the last quarter.

We've been seeing price declines come down, but it's worth balancing those price declines with the fact that Lithium prices have been plummeting which is good, but you know that's just one component here and we want to potentially see Lithium prices come back down or continue to come down. But we also want to see cost Savings in other areas which we are seeing and is probably why we've been seeing these cost declines here. Really, it's a way of saying hey, there's deflation in manufacturing whether that's coming from Innovation or that's coming from cheaper, uh, commodity prices or it's coming from both. For example, going to a 48 volt architecture system and the massive reduction in need to use copper is one of the ways that you could actually save money.

However, we are coming to a limit in terms of how much of a reduction you could actually get or expect from Uh Tesla's uh, production cost. We're coming up to about a $36,000 cost per vehicle. Tesla calls that a limit. so imagine that is sort of this line that's hitting this 36,000 uh limit.

The Uh analysts and Executives in the calls did sort of indicate that oh, there's still more we can do, don't worry I'm not sure if they were just saying that because they're sad the stock is down. Uh, keep in mind this full update totally for free over on Ec.com and Uh, we also have a big house hack update that's out. so when you're done watching this, go check out that house hack update. A little scary, but also exciting when it comes to the realate market.

Uh, Anyway, no production estimate given for 2024. This is in the bingo card and in, uh, the actual call. We got nothing. bingo card, earnings call, nothing.

The only thing we heard is that Uction would be lower for 2024, but we didn't hear how much lower just lower. Just interesting and kind of annoying that we had no guidance at all. Some of the comments regarding Uh or some people were commenting that the Next Generation Investments could be why production might actually maybe even go as far as negative below the 1.8 uh, 1 million vehicles per year I don't think that's true Elon did make it cleared that Q4 is growing uh production at uh, a rate close to 2 million, but then again, close to I. Guess 1.8 is close to 2 million.

But Elon did start off by saying that hey, we're close to 2 mil. He's very, very excited about the Nextg platform calls it. uh, remarkable revolution in manufacturing one that will be uh, uh. First tested out in Giga Mexico However, they won't conduct any product announcements here and then they will only build Giga Mexico after they tested out the manufacturing in Giga Texas Which means you're going to have the manufacturing line tested out Giga Texas probably late 25.

Then in 2026, you'll probably get to Giga Mexico and we'll probably announce a third Giga Uh location for the NextGen platform at the end of 2024 or early 2025, which really means for us to actually price in the Next Generation model. We're probably looking at uh mid this year before you actually start pricing. that in stock market usually tries to price about 18 months ahead, so 18 months ahead does put us at about June July Before we start pricing in the Next Generation platform, the ramp of the Cyber truck is expected to be longer and slower than Uh other models, the model 3 being threeyear hell as Elon says, with the model Y being slightly easier since borrowed a lot from the model 3 no mention on the earnings call of solar deployment. those solar deployments substantially negative 33% Uh to the negative: Uh in Q1 of 2023, Flat: Q2 - 26% Q3 those are all sequentially, mind you, which is not great.

Another 16% down in Q4 operating margin appears to have bottomed at 7.6% now up at 8.2% Storage grew 2 and A2 Uh 2.25 times in 2023, but did fall to 19 1.5% Uh or did fall 19 1.5% in Q4 from Q3. So some kind of sequential slowdown there in solar and batteries Not great in the near-term 4 end phase: roughly $29 billion of cash, 24ish billion in debt SL payables 6.3% growth in superchargers quarter over quarter installed vehicle Uh. capacity is flat at about 2.35 million, so it looks like we'll probably be producing slight LLY below the installed capacity. Other things that we are looking at is uh uh, basically saying look, we can't predict what gross margins are going to do.

The company's obviously still got pretty good gross margins at 17.2% X credits. That's pretty remarkable, but without that real growth, which they say is really driven by interest rates, it's hard to say what margins are going to do. Elon says if rates come down quickly, margins will go up. If rates come down slowly, margins won't go up as fast.

Pretty straight. Straightforward shows you that Tesla is an interest rate sensitive company. In my opinion, that can still mean recession resilient, but not interest rate resilient. Very big distinction.

that's very important Company talking about being between two major growth waves. Essentially a way of saying hey, we're going to be at a little slower period of growth. that is, we may have been growing at, you know, 40 to 50% da da da. Then we hit a little bit of a trough and that's hoping to set up for the next scurve.

Uh, actually downplayed Optimus here I Was pretty surprised not Optimus Dojo was downplayed I was pretty surprised with how much Elon Musk downplay Dojo He called it a high potential high risk or sorry it a project that has potential. but that is high risk High payoff and that it's potentially a long shot without a high probability of actually occurring. Uh, this is why they're undergoing with a dual path approach to figuring out uh, artificial intelligence which is basically a way of saying like we're all in on Nvidia while at the same time all in on uh, uh Dojo at the same time interesting way to put it. Uh, and I do think that downplays Dojo quite a bit more than I expected.

They are about to complete version three of Tesla's Hardware that uh, worth noting is uh, not uh, that's actually Hardware 5. That's because they started with mobile Ey, then Nvidia and then three versions of Tesla Hardware They are, uh, not seeing any interest in other companies, uh, in the scope of full self-driving licensing. Even though Elon's open to that, we're not seeing anybody actually bite on it. He seems to think that other people don't think it's real yet, which I agree.

Why? I think they ought to, You know, consider advertising how beautiful that full self driving is, but they might get inou. Trouble With The Regulators if they do that, Laob facility is adding another production line expected to double its capacity for battery packs from 10 20 gwatt hours to 40 inbound. Logistic costs are coming down they're optimizing and negotiating on Advertising They have run digital, targeted Uh campaigns to drive awareness education. However, the biggest issue they still see is affordability.

They are trying to address misconceptions of EVS on safety and affordability, but everything ultimately comes down to and they don't want to overspend on Advertising Uh, by the way, if I haven't made it clear yet I'm back to doing stock market open live streams. They're just on a different Channel they're on the meet Kevin uh Market Open Live Stream channel. it's linked down below. If you hit notifications on that or just subscribe to it, you'll just see it every morning the Market's open at 5:25 a.m.

Uh. And then of course this complete summary including our bingo card is available at Ec.com You'll see the link down here. you'll see the video stream with all the live information, and you'll also be able to scroll through and see some other updates here from employees. Let go eack! Red Sea Talk Taylor Swift Whatever Asml Texas Instruments Some cool information here on Ec.com Totally for free.

Totally free service for free forever. Uh well. some of the things that I was surprised that did not get mentioned uh I was surprised we didn't I I Wasn't really surprised. We didn't get anything on Uber or a van but I was surprised that we did not get any Red Sea Commentary: We did get Bingo twice.

Boom boom Elon did walk back the 25% stock comp. He mentioned this is not to get economical 25% control. it's simply he wants more voting control and He thinks he can accomplish this with a dual class of share. That's that he believes Tesla's on the path to creating an AI and Robotics Juggernaut and he doesn't.

Uh, he doesn't want to control it. but he also uh, doesn't want so little influence that I could be voted out by some random share older holder he argues. uh, so we did not see any comments on a solar bottom. No talk about a van or Uber no talk about further price Cuts nominal talk about the charging Network So I I left that one unchecked.

No production numbers, which was really surprising. No Union talk, no audible puff of a joint. No mention of digging our own grave. No mention about crypto.

No mention of Earth as a market. No, uh, whatever. Frameworks over here. Uh, no insulting an analyst.

Uh, some of these things were slightly de Eii wasn't mentioned. Some of these may have been mentioned, but would have been relatively nominal I Can't remember if he mentioned production as hard or some of these, so it's possible at some of these others I wasn't paying attention to as much. But anyway. uh, the ones that were very clear.

of course, they have an excess supply of 4680. This was very interesting, plenty of 4680. and they think they're going to sell out cyber trucks for 2024 based on how many people are converting off the Weit list. Obviously there's a loss in that, but they think they're going to do eventually.

up to 250,000 cyber trucks a year. They did not give a production Target for how many they produced last year or how many they're looking for this year. they uh, did mention twice the most valuable company in the world Comment: uh, interest rates were complained about. Project Redwood was talked about AI Day was briefly talked about although Elon was a little bit concerned.

other companies are just copying everything that they're doing so. uh, as far as the actual stock, well, I mean not a surprise. the sucker's down and missed. This is what's supposed to happen in earnings.

the company. the stock is not as down as much uh as I Thought it would have been though. who knows. sometimes after these calls are done, it plummets even more.

They did talk about how Optimus is extremely revolutionary, but some of the executives sort of argued like hey, well you know, does it do anything you useful and there was like a little bit of a back and forth there between the exec and Elon Where's like yeah yeah, it already does useful stuff. Yeah, stock almost down 6% now so you are getting a bleed. The implied volatility was 6% so uh, we'll see if how puts end up printing tomorrow. Uh, if they do at all.

since we're not past 6% yet, the the stock could end up falling more tomorrow. who knows. I Do think on a technical basis with this bad news out of the way. I Do think that 175 is a pretty safe floor? No guarantees.

but I've been very clear that when we failed this breakout here and earnings were coming up 175, well, well, 221 was easy, but 175 was a possibility and so we are on a nasty downtrend right now, so you do have some potential near-term pain. Uh, however, I do think as usual, after earnings, you get a few days of down and then you do potentially have the opportunity for for Tesla play some catchup to uh, the market essentially being at all-time highs. Look at how different those stock charts are. That's the NASDAQ for you.

That's Tesla Pretty embarrassing Tesla stuck in that wedge there. but uh, it is an interest rate sensitive stock whereas companies propping up the NASDAQ right now like Nvidia are anything but interest rate sensitive. In fact, uh, Tesla's Opex spending is heavily going into a company like Nvidia I think any if anything here of this Tesla earnings called reiterated uh what we have on uh, Nvidia's dominance in AI The fact that Elon downplay Dojo is quite frankly one of the strongest uh pushes you could see for NVIDIA like Elon basically just handed a win to Nvidia there. So I have to give Nvidia a big high five on that one.

Uh, so I still I'm still personally of this dual track mindset where you can have chip exposure. That's not personal financial advice, obviously, but chip exposure. That's uh, Nvidia AMD Asml Intel uh TSM You get your chip exposure and then potentially you equal weight that with energy and Tesla so that might be like an end phase in Tesla Those two are your anchors right now. once those two rally.

that's a goodlook portfolio. but right now you've got one that's crushing it. one that's sucking. kind of hurting the portfolio a little bit.

but I think it's just a matter of time of when interest rates go down where you get the slingshot. Even if you get a correction on chips, you get that slingshot on energy that creates a pretty good-look portfolio. The question is, when is the time to enter those? and quite frankly, nobody knows. Anyway, with that said, make sure you go to Ec.com to read the full summary and all of the other news that we've got and go check out the update that we posted at the House Hack YouTube Channel or Hous Hack Twitter You'd also follow me on Twitter at Real Me Kevin or House Hack Homes on YouTube or Twitter X whatever.

Uh, and see the full update of what my startup is doing, how we, uh, probably doubled the valuation of the company NeXT Fundraising updates and more. Thanks so much! Do not advertise these things that you told us here. I Feel like nobody else knows about this? We'll we'll try a little advertising and see how it goes. Congratulations man, you have done so much.

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