kchiem · July 24, 2024 23:23
diff --git a/tesla-2024q2.txt b/tesla-2024q2.txt
 Tesla 2024Q2 Financial Results & Q&A

 Participants
 - Travis Axelrod (Head of Investor Relations)
 - Elon Musk
 - Vaibhav Taneja (CFO)
 - other execs

 Elon Opening Remarks
 - saw large adoption acceleration of EVs, others struggled and discounted to compete; Tesla sees this as a
  short term issue.
 - believes the world is headed towards electrified transport--including aircraft and boats.
 - team executed well and achieved record quarterly revenues.
 - energy storage deployments reached all time high in Q2, leading to record profits for that business.
 - investing in AI and infrastructure to support future products.
 - on track to deliver a more affordable model in 2025H1.
 - biggest differentiators for Tesla are:
 	- autonomy
 	- scale economies
 	- most efficient EV producer in the world
 - lot of progress in FSD (v12.5)
 	- 5x the parameters of v12.4
 	- merges city/highway stacks
 	- unsupervised FSD will be a massive demand driver
 - Robotaxi unveil postponed to 10/10/2024
 - nearing completion of south expansion of GigaTexas, will house largest training cluster
 - expects to have several thousand Optimus'es produced by end of 2025 and doing useful things in Tesla factories;
  ramping up production of V2 Optimus in 2026 for customers.
 - energy business is growing faster than anything else; demand? constrained; ramping up production in US factory
  and building China megafactory to double or triple output.
 - thinks FSD will take TSLA valuation to $5T, Optimus several times that.

 CFO Remarks
 - offered attractive finance options to offset high interest rates, impacts will persist into Q3
 - effort to offer more trims with 300+ mile range.
 - revision in FSD pricing resulted in meaningful adoption rate increase.
 - cost per vehicle declined if CT is excluded.
 - working on ramping up M3 and CT, but facing material costs challenges because of impacts from tariffs.
 - energy storage deployments more than doubled.
 - service and collision repair business saw growth.
 - recent re-org resulted in $622m charge; operating expenses excluding that reduced sequentially, despite
  increased spending in AI and legal costs.
 - estimated capex for the year at over $10b, to bring 50k GPU cluster online
 - ended Q2 with over $30b in cash and investments

 Investor Q&A
 - status of roadster?  completed most of the engineering, production in 2025
 - when first Robotaxi ride?  depends on when unsupervised FSD is realized--possibly this year, definitely by 
  end of 2025
 - status of 4680 production?
  - 51% more cells produced in Q2 vs Q1, while costs reduced
  - 1400 CTs worth of 4680s per week
  - first validation CT built with dry cathode 4680s, production launch in Q4; will enable 4680s to be cheaper than
 	alternatives.
 - any update on Dojo?  demand for Nvidia hardware is so high, difficult to obtain on time.  need to make Dojo work,
  and they will.
 - what type of accessories will be offered with Optimus?  will use any accessories a human would use.
 - do you feel you're cheating people out of owning Teslas by not advertising?  they are advertising.  in US Q2,
  2/3 of sales were to new customers.
 - what is the timeline for GigaMexico?  pause until after election, not proceeding if Trump gets elected and
  imposes heavy tariffs; increasing capacity at existing factories significantly; robotaxi and optimus will be
  produced at GigaTexas
 - is Tesla in talks with other OEMs to license FSD?  a few major OEMs have expressed interest, can't comment.
 - any updates on investing in xAI and integrating Grok into Tesla software?  would require shareholder vote, but
  supportive of it.  yes, opportunities to integrate Grok.
 - when it comes to your capital investments, your AI R&D, your AI engineers, how do you decide on their allocation
  amongst Tesla, xAI, and X?  with regards to the diversion of the h100 shipment to xAI, that was in Tesla's
  interest as Tesla had no use for them at that point.  with regards to engineers, some of them don't want to
  work on Tesla specific problems, rather AGI, then it's a choice for them if they want to work at a startup with
  Elon involved or one without Elon involved.  Elon created xAI only after some engineers refuse to work at Tesla.
 - do you think the auto portion will ever fall below 50% of overall business and how will you compensate customers
  for using their cars in a distributed computing arrangement?  Optimus will exceed everything combined.  Tesla
  has all the ingredients needed for producing a large scale generalized high utility humanoid robot--manufacturing,
  most experience with real world AI.  Believes long term Tesla market cap will be over $5t, and several times that
  with Optimus.  HW5 will be out end of this year and it would make sense to do distributed computing on it.
 - it will be several years before any FSD licensing revenue is realized because automakers move slowly.
 - what's your strategy regarding the import of vehicles from Shanghai to Europe given the various tariffs?
  Tesla adapts as needed to the tariff situation.  Berlin has been making RHD Model Ys that have been exported to 
  the UK.  Still importing M3 into Europe from Shanghai.  Cooperating with European authorities and confident
  they'll get a better rate.  Berlin has been exporting vehicles to other places too, including TW.
 - FSD is a generalized approach, but will Robotaxi use a targeted, geofenced solution?  Robotaxi uses FSD, so it'll
  be a generalized approach.  Does not foresee regulatory issues with FSD.  With v12.5 or soon after, Tesla will
  be pursuing regulatory approval for supervised FSD usage in other parts of the world, expects approval before
  end of year.
 - GM cancelled their pedal-less/wheel-less vehicle because of uncertainties with the regulatory environment.
  How is Tesla different?  GM cancelled because they can't make it work, not because of regulatory environment.
  Waymo works fine in this environment.
 - You said FSD take rate is up after price decrease, can you share details?  Nope.  Started with a low base,
  saw encouraging increase.  Latest version tracks eye movement and requires little to no intervention.
 - Do you have plans on building your own ride hailing service?  It'll just be the Tesla network using the
  Tesla app.  There'll be 7 million customer owned cars capable of autonomy, expects most people will join the
  ride hailing program.  Tesla will also add their own fleet of vehicles to this.
 - Tesla sees more demand for ESS because of increasing demand on the grid.
 - Grid suppliers have to handle the highest peak demand.  With ESS, those suppliers running in steady state could
  produce 2-3x as much energy as they do without ESS.
 - If Trump wins, IRA might go away.  Tesla benefits from it for the M3/MY and battery production.  How will Tesla
  be affected if IRA goes away?  It would hurt Tesla slightly, but would be devastating for competitors.  Value in
  Tesla is in autonomy.  If you don't think Tesla will solve autonomy, sell your TSLA.
	Tesla 2024Q2 Financial Results & Q&A

	Participants
	- Travis Axelrod (Head of Investor Relations)
	- Elon Musk
	- Vaibhav Taneja (CFO)
	- other execs

	Elon Opening Remarks
	- saw large adoption acceleration of EVs, others struggled and discounted to compete; Tesla sees this as a
	short term issue.
	- believes the world is headed towards electrified transport--including aircraft and boats.
	- team executed well and achieved record quarterly revenues.
	- energy storage deployments reached all time high in Q2, leading to record profits for that business.
	- investing in AI and infrastructure to support future products.
	- on track to deliver a more affordable model in 2025H1.
	- biggest differentiators for Tesla are:
	- autonomy
	- scale economies
	- most efficient EV producer in the world
	- lot of progress in FSD (v12.5)
	- 5x the parameters of v12.4
	- merges city/highway stacks
	- unsupervised FSD will be a massive demand driver
	- Robotaxi unveil postponed to 10/10/2024
	- nearing completion of south expansion of GigaTexas, will house largest training cluster
	- expects to have several thousand Optimus'es produced by end of 2025 and doing useful things in Tesla factories;
	ramping up production of V2 Optimus in 2026 for customers.
	- energy business is growing faster than anything else; demand? constrained; ramping up production in US factory
	and building China megafactory to double or triple output.
	- thinks FSD will take TSLA valuation to $5T, Optimus several times that.

	CFO Remarks
	- offered attractive finance options to offset high interest rates, impacts will persist into Q3
	- effort to offer more trims with 300+ mile range.
	- revision in FSD pricing resulted in meaningful adoption rate increase.
	- cost per vehicle declined if CT is excluded.
	- working on ramping up M3 and CT, but facing material costs challenges because of impacts from tariffs.
	- energy storage deployments more than doubled.
	- service and collision repair business saw growth.
	- recent re-org resulted in $622m charge; operating expenses excluding that reduced sequentially, despite
	increased spending in AI and legal costs.
	- estimated capex for the year at over $10b, to bring 50k GPU cluster online
	- ended Q2 with over $30b in cash and investments

	Investor Q&A
	- status of roadster? completed most of the engineering, production in 2025
	- when first Robotaxi ride? depends on when unsupervised FSD is realized--possibly this year, definitely by
	end of 2025
	- status of 4680 production?
	- 51% more cells produced in Q2 vs Q1, while costs reduced
	- 1400 CTs worth of 4680s per week
	- first validation CT built with dry cathode 4680s, production launch in Q4; will enable 4680s to be cheaper than
	alternatives.
	- any update on Dojo? demand for Nvidia hardware is so high, difficult to obtain on time. need to make Dojo work,
	and they will.
	- what type of accessories will be offered with Optimus? will use any accessories a human would use.
	- do you feel you're cheating people out of owning Teslas by not advertising? they are advertising. in US Q2,
	2/3 of sales were to new customers.
	- what is the timeline for GigaMexico? pause until after election, not proceeding if Trump gets elected and
	imposes heavy tariffs; increasing capacity at existing factories significantly; robotaxi and optimus will be
	produced at GigaTexas
	- is Tesla in talks with other OEMs to license FSD? a few major OEMs have expressed interest, can't comment.
	- any updates on investing in xAI and integrating Grok into Tesla software? would require shareholder vote, but
	supportive of it. yes, opportunities to integrate Grok.
	- when it comes to your capital investments, your AI R&D, your AI engineers, how do you decide on their allocation
	amongst Tesla, xAI, and X? with regards to the diversion of the h100 shipment to xAI, that was in Tesla's
	interest as Tesla had no use for them at that point. with regards to engineers, some of them don't want to
	work on Tesla specific problems, rather AGI, then it's a choice for them if they want to work at a startup with
	Elon involved or one without Elon involved. Elon created xAI only after some engineers refuse to work at Tesla.
	- do you think the auto portion will ever fall below 50% of overall business and how will you compensate customers
	for using their cars in a distributed computing arrangement? Optimus will exceed everything combined. Tesla
	has all the ingredients needed for producing a large scale generalized high utility humanoid robot--manufacturing,
	most experience with real world AI. Believes long term Tesla market cap will be over $5t, and several times that
	with Optimus. HW5 will be out end of this year and it would make sense to do distributed computing on it.
	- it will be several years before any FSD licensing revenue is realized because automakers move slowly.
	- what's your strategy regarding the import of vehicles from Shanghai to Europe given the various tariffs?
	Tesla adapts as needed to the tariff situation. Berlin has been making RHD Model Ys that have been exported to
	the UK. Still importing M3 into Europe from Shanghai. Cooperating with European authorities and confident
	they'll get a better rate. Berlin has been exporting vehicles to other places too, including TW.
	- FSD is a generalized approach, but will Robotaxi use a targeted, geofenced solution? Robotaxi uses FSD, so it'll
	be a generalized approach. Does not foresee regulatory issues with FSD. With v12.5 or soon after, Tesla will
	be pursuing regulatory approval for supervised FSD usage in other parts of the world, expects approval before
	end of year.
	- GM cancelled their pedal-less/wheel-less vehicle because of uncertainties with the regulatory environment.
	How is Tesla different? GM cancelled because they can't make it work, not because of regulatory environment.
	Waymo works fine in this environment.
	- You said FSD take rate is up after price decrease, can you share details? Nope. Started with a low base,
	saw encouraging increase. Latest version tracks eye movement and requires little to no intervention.
	- Do you have plans on building your own ride hailing service? It'll just be the Tesla network using the
	Tesla app. There'll be 7 million customer owned cars capable of autonomy, expects most people will join the
	ride hailing program. Tesla will also add their own fleet of vehicles to this.
	- Tesla sees more demand for ESS because of increasing demand on the grid.
	- Grid suppliers have to handle the highest peak demand. With ESS, those suppliers running in steady state could
	produce 2-3x as much energy as they do without ESS.
	- If Trump wins, IRA might go away. Tesla benefits from it for the M3/MY and battery production. How will Tesla
	be affected if IRA goes away? It would hurt Tesla slightly, but would be devastating for competitors. Value in
	Tesla is in autonomy. If you don't think Tesla will solve autonomy, sell your TSLA.