Tesla Earnings Call: Top Investor Questions and What to Expect

Render of a possible Model 2 approved by Elon Musk in December 2023 commenting on X “Good Design”

@Teslaconomics

Tuesday, April 23, marks one of the most expected events for Elon Musk-led company Tesla. No, it is not yet the unveil of the Robotaxi — which is planned for August 8th — but the first quarter earnings results followed by a 1-hour earnings call answering questions from analysts and shareholders.

As of today, more than 2,300 queries have been submitted by both individual and institutional investors using the Say Technologies Platform. A total of over 8,680 shareholders have engaged in the Q&A sessions, representing approximately 7.13 million shares.

Top Investor Questions

Key areas of interest among shareholders on the Say Platform include updates on Tesla's next-generation platform, advancements in Robotaxi development, progress on Full Self-Driving (FSD) technology, and the scaling up of production for the 4680 cells.

The most prominent queries, based on votes, center around the 4680 cells initiative, followed by inquiries regarding the Optimus project and updates on Tesla's Full Self-Driving (FSD) technology, particularly in anticipation of the upcoming Robotaxi reveal scheduled for August. Here’s the list of the most up-voted questions.

1. What is the status of 4680? What is the current output?

2. What is the current status of Optimus? Are they currently performing any factory tasks? When do you expect to start mass production?

3. What is Tesla's current assessment of the pathway toward regulatory approval for unsupervised FSD in the US, and how should we think about the appropriate safety threshold compared to human drivers?

4. Following Tesla's Robotaxi unveil on 8/8, what is the realistic timeline for launching a revenue generating robotaxi network?

5. What is the progress on the cheaper next generation vehicle?

6. Can we make FSD transfer permanent? (until FSD is fully delivered / Level 5 autonomy)

7. Have any of the legacy automakers contacted Tesla about possibly licensing FSD in the future?

8. What is gating the production ramp at Lathrop? Where do you see the Megapack run rate by the end of the year?

Source: Say Platform as of April 20, 9AM ET

4680 Cells

The top-voted question, currently tallying 1,500 votes and representing 3.3 million shares, seeks insights into the development status and specifics of Tesla's 4680 battery cells.

In late January 24, Tesla said it was "running one production line and one assembly line" with "four more to be installed in the third quarter" adding that it expected "to ramp order from our suppliers". 

At the time, the world's largest EV manufacturer said the 4680 production was "ahead of the ramp, with weeks of finished cells in inventory". Six weeks later, in mid-March, Tesla said it produced over 1,000 Cybertrucks’ worth of 4680 cells at its Giga Texas. Given that each Cybertruck uses 1,366 4680 cells, Tesla produced in that week 1.366 million 4680 cells.

Optimus 

The second most popular query, trailing closely behind the first by a margin of 3.2 million versus 3.3 million shares represented, pertains to an update from Tesla's CEO regarding the status of Tesla's robot, Optimus.

Elon Musk garnered attention last January when he shared a video showcasing Optimus within a Tesla factory, demonstrating the robot folding a shirt. The video swiftly gained traction, prompting inquiries, including one from Marques Brownlee, one of the most popular YouTubers, who queried Musk: "Is this video authentic or computer-generated?”. The question was not answered by Elon. 

Approximately 30 minutes later, Musk clarified that Optimus is currently unable to autonomously fold a shirt, hinting at future developments. He asserted that it will be capable of doing so "certainly," further noting that it won't be limited to a fixed environment, such as a table with a single shirt.

Optimus folds a shirt pic.twitter.com/3F5o3jVLq1

— Elon Musk (@elonmusk) January 15, 2024

One month later, Elon posted a new video of Optimus walking faster and in a closer human-like way when compared to the previous walkdown video posted on the last day of January.

After these developments, Tesla shareholders and enthusiasts have been questioning Musk for a precise timeline of when these robots can support the manufacturer and turn it faster and more efficient.

Robotaxi + $25k Model

According to three sources and company messages seen by Reuters in early April, Tesla was abandoning its plan to launch the $25,000 model. Yet, Tesla‘s CEO Elon Musk quickly dismissed the report without specifying any further details. 

Later in the day, Elon Musk announced that Tesla is set to unveil its highly anticipated robotaxi on August 8th which is expected to be constructed upon Tesla's next-generation vehicle platform.

Two weeks ago, Tesla Chief Designer Franz von Holzhausen commented on the rumors saying "I would just say stay tuned. Don’t always believe what you read".

Franz @woodhaus2 on the new rumored $25,000 future Tesla pic.twitter.com/eAK7u3wxUI

— Zack (@BLKMDL3) April 7, 2024

In recent weeks, scrutiny has intensified among shareholders and enthusiasts regarding the accuracy of reports surrounding Tesla's $25,000 model, and whether it has been canceled or deprioritized as the company shifts its focus towards autonomous driving technology.

Wedbush analyst Daniel Ives, in a note released on Friday, remarked that the debate between the Model 2 and Robotaxi has gained significant attention, with investors eagerly anticipating an announcement from Tesla CEO Elon Musk regarding the Model 2 within the next 12 to 18 months.

Deutsche Bank analyst Emanuel Rosner echoed similar sentiments earlier in the week, expressing a belief in the "high likelihood" of a delay in the Model 2 release, citing Tesla's strategic pivot towards Robotaxi technology. Rosner emphasized that the firm's Buy rating hinged on the arrival of Tesla's next-generation vehicle, originally anticipated for late next year.

On Friday, Tesla's stock plunged to a new 15-month low of $145.05 per share during pre-market trading, resulting in a market capitalization dip below $480 billion.

Earlier this week, Tesla expanded its 0 percent interest financing program to the German market, mirroring a similar initiative launched in China earlier this month. This financing option is now available for the Model Y Long Range Dual Motor or Performance variants in Germany, with the Performance model starting at €59,990 and the Long Range dual motor variant priced at €54,990.

In a significant internal announcement on Monday, Tesla disclosed a workforce reduction exceeding 10%, affecting over 14,000 employees globally.

Despite Tesla's recent announcement of the production of 433,371 vehicles, with 386,783 delivered, the figures fell short of Wall Street's expectations of 431,000 units delivered.

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Tesla is Creating a Voice Assistant to Replace Voice Commands [Example of Voice]

It looks like Tesla may soon be replacing its archaic voice commands with something much more useful — a voice assistant.

Greentheonly, who often takes deep dives into Tesla software by decompiling the firmware and looking for changes, has now found the early integration of a voice assistant.

Voice Assistant Already Available in China

Tesla has already replaced its voice commands in China with a voice assistant that can not only control certain aspects of the vehicle using more natural language but can also answer common knowledge questions such as the current weather, stock quotes and more (video below).

Tesla Creating Own Assistant

According to Green's findings, it looks like Tesla may be rolling its own solution instead of integrating something like Amazon Alexa like Rivian has. Tesla created their own solution in China by using some of their own technology and several existing software solutions. However, some of them are only available in China so they don’t scale to support additional regions.

Grōk

The first thought that comes to mind is Tesla leaning on AI efforts by Grōk and xAI, which could help it support common knowledge questions and search the web for answers. However, that only gets Tesla partly there, as Alexa and Google Assistant already support a large ecosystem, one that may not be available if Tesla creates their own voice assistant. With Tesla’s solution, a driver may be limited to what devices they can control through the voice assistant, at least initially. Either way, just a more natural way to activate certain vehicle solutions will be an improvement over what’s available today. The ability to ask the assistant common questions will be the icing on top.

Wake Word

According to Green, the source code hinted at the voice assistant using a wake word, which would replace the need to press the scroll wheel on the steering wheel. Tesla has begun to use the left scroll wheel button for additional things lately such as wiper controls and a multi-function mode, so this may fit in with their plan.

It’s fun to speculate what the wake word would be or whether Tesla would add the ability to create your own. It could be something as simple as ‘Hey, Tesla’, ‘Grok’, or something more humorous as Tesla has a knack for. Unfortunately, there weren't any hints on what the actual wake word would be, but being able to set a destination, play a specific song or ask the assistant for the weather will be a much-needed improvement.

Supported Models

It's not clear which models Tesla would support a voice assistant, but with the release of software v12 with update 2024.14.3, Tesla is starting to leave more features out of older Intel-based vehicles. While a voice assistant may not necessarily be computationally heavy, it may depend on Tesla's implementation and whether voice commands are transcribed on device or carried over the internet for transcription.

Voice Model

In the software, there are references to Microsoft's text-to-speech technology and specifically to a voice named “Jenny Neutral.”

The “Jenny Neutral” voice seems like an acceptable voice, bringing a natural-sounding voice to Tesla's voice assistant, although it doesn't differ much from what you find on other assistants. You can view an example of Microsoft’s “Jenny Neutral” voice in the video below.

Tesla has been more mindful lately about adding information for unreleased features to its software to help prevent leaks, so by the time something like this is found by Green, it usually doesn't take long before it becomes available, although this could also make for an exciting Christmas present.

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Tesla Hints at Support for Amazon Music Streaming in Update 2024.14.3

Thanks to Tesla hacker Greentheonly, it looks like Tesla will soon offer a native experience for Amazon Music in their cars.

Green decompiled Tesla's latest update, version 2024.14.3, and found references to Amazon's music service, Amazo Music.

In this same update, Tesla added Audible playback, the audiobook service Amazon bought back in 2008.

For Tesla to add support for these music services, they need to have access to APIs that are provided by the music provider. Like everything else, there's likely a deal Tesla and Amazon struck, not only for Audible which was released in this update, but also for Amazon's other services. Given that there are already references to Amazon Music in 2024.14.3, it may not be long before we see the service launch in an upcoming update.

Prime Video 

Although Green doesn't mention any references to Amazon Prime Video specifically, it's possible we may see that service added as well. Tesla's Theater "apps," are essentially links to a browser without the user interface, so detecting references for Amazon Prime Video would be more difficult to discover in Tesla's source code. Since Tesla already implemented Audible and there are now hints of Amazon Music, it’s looking like we may see support for Amazon Prime Video as well.

Not the First Time Tesla Has Hinted at Amazon Music

Back in 2020, we saw Tesla add hints of supporting Amazon Music, although the code was scrapped in a later revision. The same source code in 2020 had references to Pandora, Audible and Apple Music. Since then we've seen Tesla add support for two of those services, with Pandora being the only one left out.

Top Music Services in the World

According to Exploding Topics, Amazon Music is the fourth most popular music service in the world as of February 2024 with a 13.3% share of the market. Number one is not surprisingly Spotify, with Apple Music and Tencent (Chinese music service) taking the second and third spots respectively.

Who Will Get Access

Amazon Music will actually be a great addition, especially if you don't pay for a separate music service like Spotify or Apple Music, but have Amazon Prime.

In the U.S., LiveOne, previously known as Slacker is the default music service that comes for free with Tesla — although Premium Connectivity is still required to listen while driving. Tesla simply calls it "Streaming" in the vehicle since this was named before Tesla had support for multiple music services. Tesla currently supports LiveOne, Spotify, Apple Music, TIDAL, TuneIn and SiriusXM on the Model S and Model X.

Although LiveOne is free, it has several limitations on audio quality, music curation and song selection. It also doesn’t allow you to jump to certain parts of a song.

Amazon Music offers a much more robust solution, so it's expected to be a nice upgrade for owners who already have access to the music service.

If you subscribe to Amazon Prime and get the free version of Amazon Music, it's expected that you'll have access to it in your vehicle without any additional charges, just like you do on your phone and other devices.

Amazon also offers a premium plan for $10 per month that includes higher-quality audio and access to a larger music library. However, we don't believe the premium plan will be required to use the service in the vehicle.

Tesla update 2024.14.3 is currently rolling out to customers around the world, although it could be several weeks before most customers have access.

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