Tesla’s quarterly report could land Musk another $3 billion

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By Noel Randewich



Elon Musk wearing a suit and tie: FILE PHOTO: Automobile awards The golden steering wheel in Berlin


© Reuters/Hannibal Hanschke
FILE PHOTO: Automobile awards The golden steering wheel in Berlin


(Reuters) – Tesla’s upcoming quarterly report could put another $3 billion in Chief Executive Elon Musk’s pocket.

The electric car maker on Tuesday saw the six-month average of its stock market value hit $250 billion, a milestone toward triggering the fourth of 12 tranches of options to buy Tesla stock at a discount, granted to the billionaire in his 2018 pay package.

Musk’s compensation is exclusively made up of a series of potential stock options rewards based on market capitalization and operational goals. To secure Musk’s fourth tranche, Tesla still must hit a goal related to revenue or profitability, and that could happen in the company’s third-quarter report, the date of which has yet to be announced.

Elon Musk’s expanding payout: https://fingfx.thomsonreuters.com/gfx/mkt/ygdvzklzopw/Pasted%20image%201602009124093.png

Tesla’s stock was down 0.8% at mid-day on Tuesday, but the company’s six-month average market capitalization rose, thanks to a strong rally in recent months.

Each tranche gives Musk the option to buy 8.44 million Tesla shares at $70 each, about a sixth of their current price.

At Tesla’s current stock price of $420, Musk would theoretically be able to sell the shares related to the upcoming tranche, plus three other tranches that vested in recent months, for a combined profit of $11.8 billion, or almost $3 billion per tranche.

Musk’s first tranche was worth about $700 million in May, when it vested, but its value has increased along with Tesla’s stock price.

The Silicon Valley billionaire’s pay package, which surpasses anything previously granted to top U.S. executives, was controversial when it was approved by shareholders. The median compensation

Tesla’s Latest Numbers Put Growth Concerns to Rest

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In recent months, Tesla skeptics have argued that the company’s growth had stalled. After delivering a record-breaking 83,500 vehicles in the third quarter of 2018, the company’s deliveries grew only modestly in the next few quarters: 97,000 in the third quarter of 2019, for example, and 90,650 in the second quarter of 2020.

ARS TECHNICA

This story originally appeared on Ars Technica, a trusted source for technology news, tech policy analysis, reviews, and more. Ars is owned by WIRED’s parent company, Condé Nast.

But Tesla’s Q3 2020 numbers, released Friday morning, put those concerns to rest. Tesla says it shipped 139,300 vehicles in the third quarter of 2020. That’s up 53 percent from last quarter and up 45 percent from a year earlier. It’s also up 24 percent from Tesla’s previous best quarter—the fourth quarter of 2019.

The number slightly exceeded the consensus forecast of Wall Street analysts, but Tesla’s stock still fell about 3 percent in Friday morning trading.

The jump in Tesla deliveries presumably reflects the opening of Tesla’s new factory in Shanghai around the start of the year. If not for the coronavirus, Tesla might have achieved record-breaking numbers in the first and second quarters. But Tesla had to briefly shutter the Shanghai factory in the first quarter, and the Fremont factory was closed from late March through mid May. So the third quarter was the first time both factories were operating throughout a quarter.

Rapid growth is important for Tesla to justify its astronomical stock value. Wall Street values Tesla at more than $400 billion—more than the combined market values of GM, Ford, Volkswagen, and Toyota. That’s despite the fact that those companies each make millions of cars per year, while Tesla delivered only 367,500 in 2019.

At the start of the year, before the extent

Teslas can now roll through green lights automatically

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Autopilot grows smarter.


Tesla

Tesla continues to tweak and update its Autopilot system, likely in preparation for a Full-Self Driving beta set to launch in about a month, according to CEO Elon Musk. The latest update adds the capability for Tesla vehicles to automatically drive through green lights without a lead car.

According to the Tesla release notes, the vehicle will not require “explicit drive confirmation” to move through an intersection when a traffic light turns green. Before this update, drivers needed to give the car permission to proceed with a stalk push or a tap of the accelerator anytime they used Autopilot on city streets. Autopilot also always relied on a car in front of the Tesla to indicate when it was safe to start accelerating. All of these functions require Tesla owners to purchase the Full-Self Driving upgrade package, and no, it does not make any Tesla fully autonomous, despite its name.

Now the software will let a Tesla simply roll through as it recognizes the green signal even if the EV is the first car in line. When this happens, “the stop line in the driving visualization will turn green to indicate that the car will continue through an intersection,” according to the release notes. Don’t expect the Tesla to take over every intersection, though. The notes also state drivers still need to give the car permission if they’ve already brought the car to a complete stop when the light turns green. Autopilot also will not turn through an intersection — only accelerate in a straight line. The automaker said it expects that, as it gathers more data from the fleet of Teslas using the software, it will

Analyzing Tesla’s Disappointing 3Q20 Unit Sales Data

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First and foremost, it was a miss.  That’s why TSLA shares are trading lower today.  The Internet was full yesterday of buffoons screaming about a deliveries number “in the 140s” and Tesla’s report of 139,300 units delivered in the third quarter falls short of that estimate.  The “whisper” estimate for Tesla’s 3Q2020 deliveries was higher—north of 145,000 units—but I won’t dishonor my beloved profession of equity analysis by naming the buffoons who pumped TSLA shares yesterday. 

The reported deliveries figure does imply a 43.3% year-on-year gain in unit sales for Tesla.  That said, Tesla’s own material shows an annual rated capacity of 690,000 units as of the end of the second quarter of 2020.  That implies a quarterly run-rate of 172,500 units of capacity.  

Tesla first divulged its annualized run-rate capacity in its 3Q2019 earnings deck.  Then the company rated that capacity as 440,000 units globally with capacity to produce 350,000 Model 3/Y units and 90,000 S/X units

Is Charging Infrastructure A Bottleneck To Tesla’s Growth?

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Tesla’s (NASDAQ: TSLA) network of Superchargers enables Tesla drivers to recharge their cars in as little as an hour, reducing range anxiety and improving the experience of owning a Tesla. Below, we take a look at how Tesla’s supercharger network is expanding and compare its growth with the company’s cumulative deliveries and rival charging networks.

View our dashboard analysis on A Closer Look At Tesla’s Charging Infrastructure

Tesla’s Supercharger Network Is Growing, But Not Quickly Enough

Tesla’s Supercharger network has grown from around 1,200 stations in Q1’18 to over 2035 stations as of Q2’20. The number of Supercharger connectors, which indicate the number of vehicles that can be charged simultaneously, has expanded from 9.3k to 18k over the same period. The number of Supercharger connectors per Supercharger location has expanded modestly from 7.7 to 8.9 over the period. However, with the launch of the Model 3 and Model Y, and Tesla’s rapid production scale-up, the number of Teslas on the road is outpacing the growth of its Supercharger network. As Tesla’s Cumulative deliveries have grown from 320k in Q1’19 to 1.1 million in Q2’20, this means that the number of Vehicles per Connector has grown from under 35 in early 2018 to about 60 presently. Tesla owners can still use third-party networks (which may require adapters) although the speed and experience are unlikely to be the same as using Tesla’s own supercharging.

How Does Tesla’s Network Of Chargers Compare With Rivals?

Tesla is still ahead of its rivals when it comes to fast charging – with a total of over