What A Twisted Net We Tweet
I’ve been dazed and confused by Tesla’s (Nasdaq: TSLA) earnings for therefore lengthy, it’s not true. Wished an EV maker, by no means bargained for you…
Umm, what was so complicated about Tesla’s report?
Nicely … nothing. That’s essentially the most shocking half, if you happen to’ve tuned into actually some other quarterly report from the Massive Crimson T.
All through Tesla’s time within the earnings confessional final evening, there was no Elon-related lunacy. No Musky memes. No attention-seeking shenanigans clouding Tesla’s quarterly financials — for as soon as.
For all intensive porpoises, Tesla reported a very regular report. And what a banger of a report it was!
Tesla ended up beating estimates throughout the board. Car deliveries are at document ranges, bringing automotive income up 87% 12 months over 12 months.
Whole income hit $18.8 billion on the quarter, beating expectations by about $1 billion and notching a brand new gross sales document. Even earnings per share got here in at a document $3.22, topping analysts’ expectations for simply $2.26.
In truth, Tesla was so bullish that it provided giddy ranges of steerage. Whereas the corporate didn’t give precise expectations for future car deliveries, Musk and co. nonetheless count on 50% to 60% progress in car manufacturing in comparison with 2021.
It’s a daring declare contemplating Tesla nonetheless faces the specter of plant closures, with the Shanghai manufacturing facility simply now resuming manufacturing “at restricted ranges.” However when have Musk’s daring claims ever not come to fruition?
I hope you’re being sarcastic…
Me? Be sarcastic? Why, I by no means!
I simply need to know: How’d Tesla do it? How did the Musk Man pull off such a powerful beat, all of the whereas enhancing Tesla’s margins?
I imply, costs for every part are skyrocketing, not to mention costs for battery supplies. The combination of metals that goes into your typical EV battery was 70% costlier final quarter than within the quarter prior.
It’s easy: Tesla simply began utilizing a unique mix of battery supplies.
Half of the Teslas shipped final quarter use “LFP batteries” — lithium-ion batteries with out the costlier cobalt or nickel of different batteries. Tesla claims these LFP batteries nonetheless have the identical vary as different Tesla batteries, whereas additionally bringing down the entire price per automobile.
Wait, was this about constructing higher batteries the entire time?
Welcome to the present! That is what everybody from Nice Stuff to Charles Mizrahi to Paul Mampilly have been speaking about for … nicely, ever since we began speaking about EV batteries within the first place.
For TSLA shareholders, this report is the stuff of desires. A double beat and lift rally? Don’t thoughts if I do!
So … what’s the catch? After following Musk’s misadventures for years now (willingly or lower than willingly), a part of me has to marvel when the opposite shoe is gonna drop. Why is Elon enjoying near the vest swiftly?
Is it — oh, proper. In fact it needed to be Twitter (NYSE: TWTR).
With all that boring, company earnings enterprise stuff out of the best way, Elon can now refocus his attention-grabbing antics on, you guessed it, shopping for Twitter.
Tesla’s excellent but business-as-usual report was nonetheless sizzling off the digital presses when, this morning, information broke that Mr. Musk is considering a young provide to outright purchase TWTR shareholders’ stakes.
In keeping with the filings, Elon has the likes of Morgan Stanley, Financial institution of America, Barclays and others prepared to offer $46.5 billion in funding.
Are you saying funding’s … secured?
Sigh. Sure, sure certainly. However with Twitter poison-pilling itself as an alternative of negotiating with Elon, this provide is unlikely to get anyplace. Attempt once more subsequent week, bucko.
So the place are we on the finish of all this hubbub?
For Tesla traders, the one actual risk it’s a must to fear about is your CEO’s consideration slipping increasingly over to the Twitter-sphere. It didn’t work for Jack Dorsey, and it received’t work for Musk.
In any other case? Tesla’s enterprise is in primo form — and you possibly can do with a couple of extra “boring” experiences like this one.
For Twitter traders … perhaps you’ll have your shares purchased for a premium value when Elon tries this routine once more for the umpteenth time.
For the remainder of you? Nicely, try the different different factor that Elon Musk is obsessive about proper now:
Musk, Dalio and Cuban are all loading up on this one crypto coin. It’s known as the Subsequent Gen Coin, and the monetary elite say it could possibly be 20X greater than bitcoin.
Mark Cuban proclaimed this coin “will dwarf bitcoin.” Billionaire hedge fund supervisor Ken Griffin mentioned it’s “superior to bitcoin and can finally exchange it.” That’s as a result of, as this presentation explains, this coin has the power to “energy the rails of worldwide finance.”
As you’ll see on this particular interview, crypto professional Ian King reveals the complete particulars on this coin … and why you must make investments earlier than the improve date. Click on right here to see extra…
Optimus Prime Supply
As if Amazon (Nasdaq: AMZN) wanted one other feather in its already-cosmic cap, the e-commerce large apparently fancies itself the brand new FedEx (NYSE: FDX) of the delivery success world.
Within the wee-early hours of the morning, Amazon introduced that it might pimp out its supply providers to “Purchase with Prime” members. Purchase with what now?
Basically, “Purchase with Prime” is a brand new characteristic that lets third-party retailers use Amazon’s monumental delivery and logistics community usually reserved for Prime prospects.
Sellers can piggyback off Prime’s expedited delivery and even put Prime badges on their web sites to let customers know they take part in this system.
However as with all issues Amazon, the characteristic doesn’t come free for sellers.
The brand new service is out there by invitation just for now — and pricing will range relying on cost processing, success wants, storage and different charges. One can solely think about how rapidly these “different charges” may stack up…
Similar to how Amazon Net Providers began, vp of Amazon Prime Jamil Ghani hopes “Purchase with Prime” grows right into a software to assist third events leverage their very own companies with ultra-fast delivery.
The transfer additionally places an infinite quantity of strain on opponents FedEx and UPS (NYSE: UPS), which have been at warfare with Amazon’s delivery providers for years now.
So … mainly, Amazon’s simply doing Amazon issues once more? Taking up the entire world and whatnot?
You higher consider it! Thanks once more, Bezos.
Carvana’s Wheels Come Off
Carvana (NYSE: CVNA) simply can’t appear to seize that pre-pandemic car-buying profitability it so desperately craves.
The corporate simply posted a lack of $260 million this final quarter, or $2.89 per share, making final 12 months’s $36 million loss seem like peanuts.
Factor is, used-car demand doesn’t appear to be Carvana’s important drawback. Whereas income hit the skids this quarter, Carvana nonetheless managed to promote 105,185 vehicles to retail prospects within the new 12 months. That’s up 14% from the identical quarter in 2021.
So, what offers?
Does it begin with “i” and finish in “flation?”
Proper you might be, Nice Ones! Carvana mentioned rising rates of interest and an uptick in used-car costs had been partially in charge for this quarter’s income quagmire.
Including to the ache, Carvana preps its used-car capability six to 12 months upfront — that means it deliberate for this 12 months’s stock quantity with out budgeting for inflation and is now paying the worth.
Seeking to the long run, Carvana mentioned it isn’t offering any “particular numeric near-term steerage” for the remainder of the 12 months. Translation? The used-car business has turn out to be so unsure that Carvana can not take inventory of the present state of affairs.
This isn’t an enthralling signal to shareholders that issues will quickly get higher, which is why I wasn’t shocked to see CVNA inventory down 6% on the day.
Come Fly With Me
On the alternative facet of the inflation dialog sits — erm, soars? — American Airways (Nasdaq: AAL).
Not like a few of its different high-flying foes within the airline business, American mentioned that March was the primary month for the reason that begin of the pandemic that income surpassed 2019 ranges.
Whereas the corporate nonetheless hasn’t reached cruising altitude but when it comes to profitability — it reported an adjusted lack of $2.32 per share in Q1 — American says that issues are trying up for the second quarter. It now expects Q2 gross sales to climb 8% larger than 2019 figures regardless that it’ll fly far much less planes than three years in the past.
Has it solely been that lengthy? These three years have felt like an eternity, I inform you.
To make up for its capability headwinds, American will take a web page out of its opponents’ e book and lift the price of its flights to offset rising inflation. Not like fellow journey firm Carvana, nevertheless, American has extra pricing flexibility and may change course simpler based mostly on present market situations.
And adaptability, it appears, is the title of right this moment’s inflationary sport. As such, AAL inventory jumped practically 5% following right this moment’s information.
Time After Time Warner
It’s been about two complete weeks since AT&T (NYSE: T) and WarnerMedia — now Warner Bros. Discovery (Nasdaq: WBD) — went their separate methods, and I have to say, the preliminary breakup doesn’t look too unhealthy for the broadband telecom firm.
AT&T reported first-quarter earnings this morning that noticed income hit $38.1 billion — simply shy of Wall Avenue’s consensus estimate. This determine consists of AT&T’s ex, WarnerMedia, however it’s the final time the mass media firm will present up on AT&T’s monetary filings.
The best way AT&T tells it, the now-divested media section weighed closely on the corporate’s revenue margins this quarter after launching CNN+ (which has already been killed off within the time it took to ship this to you) within the U.S. and HBO Max in a number of worldwide streaming markets.
With out WarnerMedia, AT&T made an adjusted per-share revenue of $0.63 — beating the Avenue’s $0.61 per-share projection. Postpaid subscribers additionally grew by 965,000 customers final quarter, nicely forward of Wall Avenue’s 573,000 estimate.
In different phrases, AT&T’s funding into the 5G and fiber optic markets appears to be paying off. It continues so as to add new prospects at a wholesome clip — and it’s made important strides to maintain current prospects by way of improve packages and promotions.
Neat. So, what’s the catch?
Nicely… AT&T’s subscription progress appears to be like growthy till you evaluate it to the variety of new customers who signed up for HBO Max the previous three months: a whopping 3 million. That marks a 12.8 million enhance in HBO Max customers 12 months over 12 months.
Issues is, HBO Max is now a part of Warner Bros. Discovery, which AT&T simply spun off — so that is the final time that AT&T can boast about HBO’s booming market earlier than it falls underneath Discovery’s monetary disclosures. Confused but?
I knew I shouldn’t have eaten that fourth brownie final evening…
Principally, HBO is trying like a powerful contender within the cutthroat streaming market and has now turn out to be the third-largest streaming platform within the U.S. (Technically, Disney+ and Hulu are owned by the identical firm, however we’ll save that may of worms for one more day).
Had AT&T held on to HBO, its inventory most likely would’ve skilled a a lot greater pop right this moment. However hey, them’s the breaks while you streamline your corporation … and nobody can say they weren’t Warnered.
That’s all, people!
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