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1/ With the end of Q2 imminent, let's summarize where things stand for $TSLA. Let's start first with the Big Picture... $TSLAQ
2/ In Q2, $TSLA will approach its record Q4 delivery number (90,700). So, what about revenues & the bottom line?
Here's what Q4 looked like:
$6.3 billion auto revs
$7.23 billion total revs
$139 million GAAP profit
Here's what Q4 looked like:
$6.3 billion auto revs
$7.23 billion total revs
$139 million GAAP profit
3/ In Q2, regardless of the delivery number, all three of those metrics will be down. $TSLA will swing to a loss. How big a loss? That depends on what tricks Tesla plays in recognizing deferred revenues & the regulatory credit revenue wild cards. But, decidedly, a GAAP loss.
4/ And that adds up to a company that is Structurally Bankrupt. Why? Because it's all downhill from here. We have another US FIT cliff, the exhaustion of US backlog, the near exhaustion of EU backlog (only a tiny number of SR+ & RHD remain as backlog)...
5/ ...the arrival in the EU of another formidable competitor, the Mercedes EQC. (Already, Jag's I-Pace & Audi's E-Tron have cut the guts out of $TSLA Model S & X margins. It becomes only worse in Q3.)
6/ $TSLA has tried to hard to focus analysts & investors on useless metrics such as unit deliveries & gross margin. But, increasingly, everyone sees right through the tricks. Unit deliveries are achieved with price slashing. Gross margin is achieved with misleading accounting...
7/ ... such as charging obvious warranty costs to "goodwill" (SG&A rather than COGS) which, of course, allows $TSLA to print a misleadingly tiny warranty reserve number. Accounting fraud? At this point, a case can certainly be made.
8/ Latest example of a sharp sell-side analyst seeing right through the Musk BS? Cowen's Jeffrey Osborne (h/t @TeslaCharts): 
9/ In Q2, $TSLA slashed prices to move its huge inventory. So, expect a good EOQ cash balance. Expect lots of buzz words from Musk to disguise the dire situation. @bgrahamdisciple has your bingo card:
10/ And yet, les jeux sont faits, as the croupier says when he spins the roulette wheel in the French casinos. Profits, promised last year for every quarter thereafter, will never again materialize on the $TSLA income statement.
11/ This despite the fact that $TSLA continues to be:
Of the Subsidy,
By the Subsidy,
For the Subsidy.
(Abe would weep.) Consider the quasi-fraud $TSLA committed in Canada in Q2 to milk subsidies:
Of the Subsidy,
By the Subsidy,
For the Subsidy.
(Abe would weep.) Consider the quasi-fraud $TSLA committed in Canada in Q2 to milk subsidies:
12/ If there's one workforce $TSLA won't slash, it's its cadre of lobbyists. They'll need to work very hard in Q3, as Canada has decided enough is enough, and Massachusetts is about to end handouts. electrive.com/2019/06/26/mas…
13/ Even in subsidy-rich Colorado, the Model 3's reputation for unreliability has caught up with it:
14/ Heck, even in California, $TSLA's principal market, Tesla can't move much more metal. Earlier this week, the supply-constrained company, which claims to be struggling with delivery logistics, reached out to a would-be customer:
15/ In Q3, what $TSLAQ has long realized will become unmistakably evident to the rest of the financial world:
The Growth Story Is Over!
Y-O-Y growth will be tiny, or flat, or negative. With tiny or flat achieved only with more price slashing, and selling SR+ variants at a loss.
The Growth Story Is Over!
Y-O-Y growth will be tiny, or flat, or negative. With tiny or flat achieved only with more price slashing, and selling SR+ variants at a loss.
16/ Yes, there will be more $TSLA narratives (or, rather, new themes on old narratives). Shanghai. Robo-taxis, Tesla truck, semis, etc. They'll fall flat.
17/ Shanghai? Someone explain how $TSLA repays its loan in March, and then explain how it ever earns a dime of profit. Robo-taxis? No sane investor believes that. Tesla truck? You'll be late to the party, pal. Semis? Time to demand refunds, oh, you, greenwashing deposit makers.
18/ How about some excitement with a $TSLA Roadster 2? Unfortunately, Tesla has promised to give away so many free Roadster 2's that it can ill afford to start making them. That, and the fact it promised fantasy specs.
19/ Some here think we'll see a $TSLA "Investor Battery Day" as a prelude to another capital raise. I threaded about that yesterday:
20/ Prediction: It won't work. Investors already feel burned from the March capital raise, where equity went out at $243, and debt quickly traded at a discount.
21/ No, @gerberkawasaki won't be moved. Neither will @CathieDWood or anyone else at @ARKInvest. And Ron Baron will still reliably appear on @cnbc, mouthing whatever inanities Musk has sent him as talking points. Ben Kallo will never back down, either.
22/ And, of course, @Gfilche will continue being the youngster with no business paying make-believe CFA. And Zach & Jesse? Well, please, some forms of stupidity are congenital, and beyond cure.
23/ But the institutions, already wising up, will see that the great growth narrative has collapsed. The staggering number of lemon lawsuits & personal injury will take their toll. The Delaware derivative action & California class action will drain resources...
24/ And brand destruction will continue. Reports of Model 3 reliability problems will multiply as the quarter progresses. twitter.com/Savolainen_J
25/ Warning: We still deal with a phenomenon that is more religion than finance. Timing remains tricky. Musk has endless new fraudy tricks to attempt. But, patience, grasshoppers. The story is coming to an end.
@Gfilche (*playing* make-believe", not "paying make-believe", of course...)
