00:00So we think about Tesla and actually when it comes to the numbers themselves it seems like we're expecting pretty
00:05good numbers but the way this stock trades it's almost as if those quarterly figures are a little bit of
00:11an afterthought. Like all things in life it's relative. They're good. I mean you're talking about 30 percent adjusted earnings
00:17growth from last year. But remember that the first three months of 2025 were not good for Tesla. No. Right.
00:22Elon Musk's proximity to the president of the United States resulted in some pain when it came to sales of
00:28EVs. But let's be honest
00:29everyone looks past the core numbers. You know Elon Musk's greatest skill as I think I've said to you on
00:34this program before and you can tell me if that's the case is keeping investors looking to the horizon. So
00:39now they want some real update on a rollout of a commercial robo taxi service and any sort of visibility
00:46on on ramp of cyber cab which should have started as well as the humanoid robot progress of Optimus. That's
00:52that's the reality of this. I mean you could make the case that maybe some of that investor patience is
00:57starting to run out a little bit
00:59because you take a look at shares year to date down about 14 percent here. Well what you were saying
01:05a moment ago about stocks being at records Tesla did participate in the last 10 sessions in that rally. But
01:11prior to that had massively underperformed its MAG 7 peers. The other thing is just that the multiple is trading
01:17at relative to the rest of the MAG 7. You know if the MAG 7 is trading at 30 times
01:21forward earnings Tesla's trading at a lot more severe than 183.
01:25Yeah it's weird say out loud 183 times forward earnings because it is valued as an AI and robotics company.
01:31So when we say that I don't say it flippantly. Yeah. I say when the earnings hit they'll look past
01:36the numbers of the core business and look for roadmap evidence of progress in those areas. Well as we await
01:42Tesla earnings coming in the next few minutes let me just quickly bring you an update from Texas Instruments getting
01:47those figures.
01:48Now you can see the stock is popping when it comes to the first quarter EPS beating estimates coming in
01:55at $1.68. The estimate had been for $1.38. So that's the look behind. Let's talk about the look
02:02ahead which might explain the reaction we're seeing in shares right now.
02:06Second quarter revenue higher seen between $5 billion to $5.4 billion. That is ahead of the estimate for $4
02:15.85 billion. But here are the Tesla figures. Let's go through some of them. First quarter adjusted EPS beating estimates.
02:23That coming in at $0.13.
02:26Since the X or rather adjusted EPS coming in at $0.41 actually the estimate had been for $0.34.
02:33First quarter revenue coming in at $22.39 billion. The expectation had been for $22.19 billion. So a bit
02:44of a beat there when it comes to revenue when it comes to adjusted EPS.
02:47And their gross margin for the first quarter a beat there as well. 21.1%. The estimate had been for
02:5417.7%. So really interesting Ed. I mean to look at these numbers as we were saying there was an
03:02expectation that we were going to get good news.
03:04But again seeing some of them actually in reality you can see that that expectation was borne out.
03:10Yeah. You know in the context of recent quarters it's relatively muted after hours reaction up 2%. Particularly you know
03:16that we got exactly what we expected on a quarter that had favorable comps from the same period a year
03:22earlier.
03:22Remember that in the first three months of 2025 Tesla was not having a good time because of the impact
03:28of their sales from Musk's relationship with the president of the United States.
03:32I've gone straight to the outlook segment and there's one thing that I'm seeing straight away which is that CyberCab,
03:37Tesla Semi and Megapack 3 which is their storage product are on schedule for volume production starting in 2026.
03:44I need to go back and compare and contrast but I'm pretty sure that the language in the prior deck
03:48said it would be the first half of 2026.
03:51So if anything it's kind of a slipped timeline. We're looking to that.
03:56Language is everything.
03:57Last quarter they slipped something into the deck called other updates and that other update was an equity investment in
04:03XAI.
04:04There is no other updates in this deck and I know that that's not what you want to hear on
04:07the close.
04:08We like a bit of drama.
04:09We do.
04:09This is a non-drama release.
04:11Non-drama release but you can see that that rally really building after hours right now.
04:15Tesla shares higher by 4.5%.
04:18Again you think about what was priced into this stock.
04:21It wasn't much shares down 14% year to date but certainly some optimism there.
04:27I mean you mentioned XAI and there is the lingering question out there.
04:30I don't think we're going to get any answers today about whether we could see a potential combination with SpaceX
04:37ahead of that IPO.
04:39That speculation has been pretty persistent.
04:41What we had reported prior to the confirmation that SpaceX had acquired XAI is that the boards of SpaceX and
04:49Tesla had looked at that option rather than take a larger private entity public through an IPO back into a
04:57public company.
04:57They didn't go that way but that's always going to be out there.
05:00It's highly unlikely and indeed it's come up on prior calls where executives had to stop themselves from answering retail
05:07investor submitted questions about SpaceX that you're going to hear any more about that.
05:12The only other thing that I'm getting from this release beyond all of that it's just a confirmation of everything
05:18that was announced in the quarter.
05:19There is no sort of guidance other than you know they are talking pretty favorably about their focus on affordability
05:26being a key competitive advantage at a time where the EV market is having a tough time in America North
05:33America.
05:34But that's not their focus either way.
05:36Yeah.
05:36Yeah.
05:37No it's interesting to see them say up high in the deck here that demand has returned when it comes
05:42to the EV market particularly talking up APAC South America also seeing a rebound of demand in EMEA.
05:48And also North America and I mean this isn't a Tesla specific problem here what we're seeing when it comes
05:54to maybe not as robust EV demand maybe cooling EV demand.
05:59I mean this is something that a lot of the legacy automakers have been dealing with as well and have
06:04adjusted their plans accordingly.
06:05But Tesla they're pure play EV.
06:08Yeah.
06:08Some of the data that we saw in that period was that the production number was outpacing their delivery number
06:15by quite a lot.
06:16That meant that they built up inventory.
06:18Then you have the reporting that one in every five cyber trucks they build is going to another Elon Musk
06:23company in most cases SpaceX.
06:26But with inventory you can manage pricing.
06:29You know Tesla's master class at the end of each quarter is promotional work to to boost the sales in
06:36the final week of that period.
06:38It is interesting that they're stating they see the demand coming back that's not necessarily in line with the macro
06:44look of EVs in this country at least.
06:47But of course you point out Tesla has a footprint in those other markets Asia Pacific being one.
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