TSLA Looks like VAIBHAV TANEJA CFO of Tesla sold a bunch of stock yesterday. He’s been on a selling spree lately selling over 8million of his stock. When the CFO is selling stock you know he sees this going way lower
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TSLA - 1. Profitability Appears Outsized Compared to Industry
Tesla reports higher margins than legacy automakers—even though it slashes prices, faces rising input costs, and spends on growth. That raises questions: • Gross margins around 20% in a capital-intensive, low-margin business? • Other EV manufacturers like Ford, GM, or Lucid are bleeding cash—yet Tesla reports consistent profit?
That’s not normal unless there are aggressive accounting tactics at play.
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2. Heavy Use of Stock-Based Compensation
Tesla books huge executive stock compensation (including Elon’s infamous multi-billion-dollar package). The accounting treatment: • Doesn’t hit cash flow, but inflates operating expenses selectively • Distorts real profit when removed in non-GAAP adjustments
This makes Tesla look more profitable in adjusted (non-GAAP) terms than it is under GAAP.
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3. Regulatory Credit Dependency
As you noted earlier: • In 2020 and 2021, Tesla’s entire profitability was due to regulatory credit sales. • Without those credits, they would’ve reported losses or near-zero income.
That’s not sustainable, and the fact they still rely on them—even in 2023—suggests fragility.
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4. Delayed Capital Recognition / Depreciation Games
Tesla may capitalize expenses that should be booked immediately, such as: • Gigafactory buildouts • Tooling and machinery • Self-driving R&D
These are amortized over years, making current profits look healthier. Some argue Tesla under-depreciates assets, which boosts short-term profit but kicks real costs down the road.
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5. Revenue Timing and Inventory Maneuvers
Tesla sometimes delivers a massive portion of quarterly vehicles in the last week, which: • Lets them hit quarterly delivery targets • Enables “pulling forward” of revenue into a quarter, possibly before full payments clear
This has the appearance of earnings management—not illegal, but definitely manipulative.
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6. Questionable FSD Revenue Recognition
Tesla sells its “Full Self-Driving” software: • Often recognizing a portion of revenue upfront • Even though the software is not fully functional
Critics argue this inflates revenue early and is aggressive accounting at best, fraud-adjacent at worst.
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Conclusion: Are the Books Being Cooked?
If not outright cooked, the books are heavily seasoned.
It’s legal. But from a forensic accounting lens, this is textbook earnings management. If a less-celebrated CEO ran the company, they’d probably be under SEC review.
TSLA - Reality: 1. The Capital Efficiency Illusion
Tesla presents as extremely capital-efficient, but: • Subsidies & Tax Credits: Tesla has benefited from billions in government tax breaks, green energy subsidies, and regulatory credits—often underplayed in earnings discussions. • Regulatory Credits: In some years, Tesla’s entire profit came from selling zero-emission credits to other automakers, not from actual car sales. Without those, some quarters would’ve been negative.
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2. Depreciation & R&D Spend
Tesla’s accounting methods also smooth out their costs: • Capital Expenditures (CapEx) for Gigafactories are depreciated over years, so the real-time costs don’t hit the income statement all at once. • R&D Spend is relatively low compared to traditional automakers (~5% of revenue vs. 10–15% at some legacy firms), raising questions about how innovation is sustained.
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3. Inventory Accounting
Tesla uses “cost of goods sold” (COGS) in a way that doesn’t always reflect immediate manufacturing expenses. Some critics argue that: • Costs are capitalized instead of expensed immediately, pushing profitability higher on paper. • There’s limited transparency into how vehicle production and delivery delays affect the books.
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4. Bitcoin and Other Financial Moves
In 2021, Tesla bought and sold Bitcoin, booking a large profit. That added to earnings—but wasn’t related to cars.
Similarly, selling equity during high stock valuations brought in billions without affecting debt—but inflates perceived financial strength.
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5. Margin Compression & China Competition
By 2023–2024, Tesla started slashing prices to remain competitive with BYD and others. This hurt margins dramatically—Tesla’s net income dropped from 15B to 77B in a year.
TSLA this is bullcrap, I thought I was doing really well tracking and charting TSLA. It’s supposed to be going down to $200 but it’s going up?!? WTH man!!!! I hate manipulation