IS TESLA DOOMED? “Tesla’s showing all the signs of a company in trouble: bleeding cash, securitized assets, and mounting inventory…

IS TESLA DOOMED?

Tesla’s showing all the signs of a company in trouble: bleeding cash, securitized assets, and mounting inventory. It’s the trifecta of doom for any automaker, and anyone paying attention probably saw this coming a mile away. Like most big puzzles, the company’s woes don’t have just one source.

It’s true that the world may be running light on buyers who will spring for a big-dollar electric vehicle that can’t make the hike from Detroit to Chicago without stopping for a long charge. And cheap gasoline isn’t helping Tesla’s case. Right now, prices around the country are hovering close to $2 a gallon. If that’s bad news for the Prius and the Volt, it’s worse for the Model S.

In addition, there’s never been any secret sauce to the company’s battery technology. The automakers that bought into Tesla’s tech early did so to avoid having to pony up development dollars on first-generation battery packs of their own. Now that Audi has announced it’s getting into the EV game, Tesla should be even more concerned. If you’re a luxury buyer, which car would you rather have?

Tesla Jumps Despite Missing, Burning Record Cash On Better Than Expected China, Outlook

Moments ago, the most hyped stock in the market announced Q3 results… and missed while burning a record amount of cash; however Musk’s contagious optimism once again dominated the outlook and as a result the stock is up by 7% after hours.
The quarter highlights:

• Telsa delivered 11,603 vehicles in Q3
• Q3 non-GAAP gross margin 25.1%, dropping from 29.4% a year ago; adding “we expect non-GAAP Automotive gross margin to decline slightly from Q3″
• The company trimmed its own guidance for full year deliveries from 50,000-55,000 to 50,000-52,000
• Non-GAAP Revenues of $1.24 billion came in line with estimates, although something strange emerged: while non-GAAP revenue rose from Q3 by about $50MM, its GAAP revenue actually declined by $18 million to $937MM. The difference: a surge in “revenue deferred due to lease accounting” which soared from $242MM in Q2 to $307MM in Q3.
• Non-GAAP EPS of $(0.58) missed expectations of a ($0.56) print. GAAP EPS was a disastrous (1.78)
• But most troubling, as usual, was the ongoing cash burn from a company which appears allergic to generating any positive cash flow. At ($595) million in free cash flow, this was the worst cash burning quarter in Tesla history, which supposedly was to be expected with the rollout of the Model X.

The results in charts:
Revenue: both GAAP and non-GAAP: