TSLA Investor Discussions

[brian45011]

[QUOTE=Hence, it looks like Petersen was counting the capital expense as an addition to the operating expense when, in fact, it's already included. [/QUOTE]

I think the "pre-production costs expensed under GAAP" refers to R&D expense which for the last quarter was $68.4million (it appears on the income statement on page 5 of the last 10Q.) Purchases of property and equipment, excluding capital leases appears under "Cash Flows from Investing Activities" in the Cash Flow Statement on page 7 of the same 10Q; it was $67.9 million for the last quarter. The 67.9 million will be depreciated on future statements. Depreciation will be an expense on future income statements, but it will also be a non cash expenditure so it will be added back on future cash flow statements as a "source" of funds.
Some of the type of expenses related to the Model S that appeared as R&D before poduction will now start appearing as "Cost of Revenue" expenses; Model X expenses will remain as R&D.
The statements that will be published on Wednesday should provide more clarity on how tight the company's cash position really is. I think Petersen overstates the "going concern" statement ( I am under the impression that those types of auditors' comments are more of an issue with 10k's than 10q's but Petersen is/was a CPA but not me.)

[Norbert]

I think the "pre-production costs expensed under GAAP" refers to R&D expense which for the last quarter was $68.4million (it appears on the income statement on page 5 of the last 10Q.) Purchases of property and equipment, excluding capital leases appears under "Cash Flows from Investing Activities" in the Cash Flow Statement on page 7 of the same 10Q; it was $67.9 million for the last quarter. The 67.9 million will be depreciated on future statements. Depreciation will be an expense on future income statements, but it will also be a non cash expenditure so it will be added back on future cash flow statements as a "source" of funds.
Some of the type of expenses related to the Model S that appeared as R&D before poduction will now start appearing as "Cost of Revenue" expenses; Model X expenses will remain as R&D.
The statements that will be published on Wednesday should provide more clarity on how tight the company's cash position really is. I think Petersen overstates the "going concern" statement ( I am under the impression that those types of auditors' comments are more of an issue with 10k's than 10q's but Petersen is/was a CPA but not me.)

It seems that sentences like "Thus, a substantial portion of our R&D expenses are one-time investments in preparation for Model S production" (in the Q1 shareholder letter) don't refer to those larger purchases of equipment ? We don't seem to know yet whether separate purchases of equipment will continue in Q2 in the same amount, even if they had similar amounts in previous quarters. At least there don't seem to be any new "Property, plant" purchases. And I'd expect equipment purchases to drastically reduce at the latest during Q3. (Unless perhaps Tesla decides to increase capacity further.)

[Norbert]

In the Q1 conference call, May 9th, Elon actually said that all of the factory machinery was already in place, and the vast majority of tooling was in place (some stamping dies were still expected for June). (Which I guess doesn't necessarily mean that it was all paid for in Q1.)

[Krugerrand]

(Which I guess doesn't necessarily mean that it was all paid for in Q1.)

That is correct. Tool buyoffs don't occur until tools have been approved by the customer and are ready to be shipped to the customer. So, if more were coming in Q2, there would be expense associated with their purchase in that quarter...unless they have 30/60/90 days to pay for them, in which case the expense might not show up until Q3.

[Norbert]

That is correct. Tool buyoffs don't occur until tools have been approved by the customer and are ready to be shipped to the customer. So, if more were coming in Q2, there would be expense associated with their purchase in that quarter...unless they have 30/60/90 days to pay for them, in which case the expense might not show up until Q3.

There doesn't seem to be any information that those amounts are even close to large enough to worry about. And it would still mean that R&D costs will go down as well, even though a part of them will continue as cost-of-revenue. And according to the Q1 shareholder letter, Tesla concluded Q1 "with $387 million in cash resources". So where would be the problem, if any? The original plan was to start delivery in July (and everyone was expecting that to potentially mean the end of July), and a slow ramp-up was always predicted by Tesla.

[Krugerrand]

There doesn't seem to be any information that those amounts are even close to large enough to worry about.

You'd probably be looking in the neighbourhood of 100k per tool on average.

[Citizen-T]

Well...this doesn't look good. Europe is trying it's best to pull us down below support. We need to hold at around $31.20 or we are going to be seeing that $28 number pretty soon. =/

[Steph]

They did it again.

Welcome to gap town.

[Citizen-T]

Action seems to suggest we are going to hold. There is a TON of support here. Buyers seem to like this price.

[smorgasbord]

Action seems to suggest we are going to hold.

I would think that Wed's quarterly report is going to be the driver for the stock this week.