Full Self-Driving (Beta) toggle is now in wide release as production vehicle software including MCU1

FSD Beta release notes used to be titled "Early Access Program | FSD Beta" but now that's gone:

Additionally the strikes system for improper usage now results in a suspension of "approximately two weeks." The number of strikes allowed is five or three depending on availability of the interior camera.

People who haven't even opted in to FSD Beta with the request button are getting the same software version 2022.44.30.5 which was previously only available to those accepted to FSD Beta:

https://www.reddit.com/r/TeslaLounge/comments/100055i

This version also introduces a tip / message to turn on Full Self-Driving if the driver profile has not turned it on to help increase discoverability of the new feature now that it's available without early access terms.

Additionally, MCU1 vehicles are getting 2022.8.10.10 as FSD Beta 10.69.3.3 also as regular production vehicle software and not "Early Access Program." Most of the FSD Beta visualizations show up in the instrument cluster albeit at lower framerate than vehicles with MCU2+.

https://twitter.com/x/status/1609266824545292289

 

[EVNow]

At a super broad calculation, $324M recognized for 400k vehicles would be $810/vehicle, so indeed it seems like some aspects of partial recognition both in the numerator and denominator.

400k will include subs.

But in general I do think they have not recognized 100% of post 3/19 cars. So, they used to recognize about 50% when bought and defer the rest. I think they may have recognized some 25%, I’ve to do some estimation to confirm.

 

[Mardak]

I think they may have recognized some 25%, I’ve to do some estimation to confirm

Alex Potter tried to get some more insights about the FSD Capability revenue recognition from Zachary Kirkhorn in the earnings call:

Alex: Quick one on FSD. This, I guess, for Zach, obviously you unlocked some deferred revenue in the quarter that'll translate presumably into higher margins on every incremental sale going forward so long as people opt in for FSD. But I was wondering if you're able to disclose the percentage of that $15,000 price that you're not going to be able to recognize as revenue up front rather than deferred.​

​

Zach: Yeah, the way that we've structured this is a full self-driving package of two components. There's enhanced autopilot, the price of which is listed on the website. We fully recognize that. Then there's an incremental, which is for the additional features of full self-driving offers. And we've released a portion of that. And then there's a minority of the total package that's remaining that will be released over time as software updates are there. And in our shareholder letter, in addition to disclosing the dollar amount of the deferred revenue release, we also included in there the dollar value of the balance of unreleased deferred revenue that will be released over time as future software updates.​

​

So he says there's a "minority" (0-50%?) and points to the "nearly $1B deferred" which including the amount recognized was previously a total of ~$1.324B or indeed roughly 25% recognized. I suppose we'll have to wait until next quarter to see how much of this remaining amount was because vehicles were not updated to FSD Beta 10.69.25.1 by the end of last year, but then it'll also get mixed up with new capabilities hopefully released in Q1 that might unlock even more.

Maybe interestingly, the balance sheet item for deferred revenue went from Q3's $1,928M to Q4's $1,747M, so a change of $181M. Maybe one can estimate the new sales and FSD take rate at $15k to get at the $143M difference?

 

[EVNow]

So he says there's a "minority" (0-50%?) and points to the "nearly $1B deferred" which including the amount recognized was previously a total of ~$1.324B or indeed roughly 25% recognized. I suppose we'll have to wait until next quarter to see how much of this remaining amount was because vehicles were not updated to FSD Beta 10.69.25.1 by the end of last year, but then it'll also get mixed up with new capabilities hopefully released in Q1 that might unlock even more.

We have to tease out multiple things
- Deferred is more than FSD - but mostly that
- Deferred is worldwide, but most FSD sales are in US
- pre 3-2019 and post can't be recognized to the same degree

In previous call Zack had said they recognize 50% of FSD revenue. So, that 1.3B was mainly 50% of FSDb (with the above caveats). We'll have to make some assumptions - but I think that 25% I put earlier (or 50% of deferred for post 3/19 US/Canada vehicles) is a good ball-park.

 

[AlanSubie4Life]

What are you counting as eligible fleet? Tesla is saying there's about 400k US/Canada purchaser/subscribers of FSD Capability presumably as of now / January. Whereas close to the end of last year (but before the wide release on December 31st), Tesla said they reached 285k. So potentially FSD Beta fleet has grown / can be grown by 40% since then?

https://twitter.com/x/status/1608552555822325762

Reading this more carefully now...

Definitely hasn't grown by 40% in that time of course.

I don't remember all the ridiculous escapes that there were, and all the different versions. There was the version which released which didn't release to everyone, because they were on the wrong version, back in November. Then there was the Christmas release which didn't release to everyone because it still required a request. But definitely expanded the pool. And then I guess the wide release got rid of the request (I really don't remember)? Which would have increased the pool more. And then there were the software versions which worked on MCU1 or whatever.

So presumably each of these steps increased slightly from the 285k a couple days before the end of the year, to get to the 400k, at some point, possibly not in Q4.

And of course a few people, totally cray-cray, bought FSD in that time period.

Anyway eligible fleet, to answer your question, would be anyone who has bought/subscribed to FSD Capability.

 

[Mardak]

Definitely hasn't grown by 40% in that time of course

I too am quite surprised by the 40% increase since Christmas, but the commentary during the earnings call and followup tweet seem to reinforce that Tesla really does mean 400k vehicles are on FSD Beta as of January 25th.

• September 19th / 10.69.2.2: 160k
• Thanksgiving / 10.69.3.1: no safety score requirement including up to 2022.36.x branch
• Christmas / 10.69.25: includes those on 2022.44.25 branch
• December 29th / 10.69.25.1: 285k includes those on 2022.44.30 branch
• New Year's Eve / 10.69.25.2: wide release not needing opt-in button
• January 25th: 400k

https://twitter.com/x/status/1618364176652718081

That seems to indicate over 100k people had purchased/subscribed FSD Capability but did not know about FSD Beta or weren't interested in the terms of "limited early access."

 

[AlanSubie4Life]

I too am quite surprised by the 40% increase since Christmas, but the commentary during the earnings call and followup tweet seem to reinforce that Tesla really does mean 400k vehicles are on FSD Beta as of January 25th

I wasn’t suggesting that it hadn’t grown that much (not surprised - there were tons of restrictions) - just was saying the *eligible* pool had of course not increased much at all, and this growth was all due to Tesla rolling out to more people. Yes, was not clear from the post.

They also said “nearly all” - so possible they have rolled out to 320k, not 400k (80% would be nearly all), though there may be info giving better precision on that actual number elsewhere.

Hard to say anything with any precision; it is intentionally obfuscated.

 

[Dewg]

As an aside - I'm visiting one of my remote offices today, and there are three guys with Telsa's here, including the one Model X I mentioned before that didn't know he had air suspension he could control. All three were on older software, and one of them had the new software but kept pressing X on the screen to install it as he didn't want to deal with it (I get the same attitude from people who don't want to install/restart after Windows Updates). All three of them purchased the FSD Capabilities package, so all three should have the Beta button available once they install the latest software version.

I guess my point to that observation is that there is probably a good chunk of Tesla owners that don't even realize they have access to Beta, but Tesla could claim delivery of it to them, and access the deferred income from their purchase.