Maturity
Disclaimer: this is not investment advice. I’m not objective on Tesla since I’m a firm believer in their mission. I do own Tesla stock.
Before taking any investment decision, do your own research.
Tesla’s recent profit surprise has a lot of people confused. Most have decided that it was a one time trick and it will go back to losses soon with no top growth.
I agree that profitability will likely be a rarity for a while. But I differ on the amount and nature of the losses: I see Tesla growing fast with very low net losses in the future, similar to what Amazon did for a decade.
What I disagree deeply is in the “no top growth” part. As I wrote in The Tesla Future I expect Tesla to build factories Like Mushrooms, which will result in automotive revenues growing at a 36% or more anual rate.
What’s more important, the rest of Tesla’s businesses that have been mostly ignored are starting to show some maturity. As Elon Musk stated in the Q3 2019 earnings call, during 2018 and first half of 2019 Tesla was forced to focus in Model 3 or risk going bankrupt. That resulted in very little growth in storage and declining sales in solar generation. The Semi and Solar Roof products were left for another time.
Now that Tesla has a large and growing cash pile and Model 3 sales are good enough to compensate for the lower Model S and X sales that the availability of a smaller Tesla produced in some markets, all the projects that are on hold seem to be starting back. Tesla stated they expect to produce Semi in 2020 in a limited capacity, storage should increase sales fast and Solar Roof production is expected to produce thousands of installations per week sometime next year (with the caveats of the S-curve of a product ramp up.) And Shanghai is ready to start production.
So instead of stagnant revenues and large losses, I expect large revenue growth with very low profits or losses. The market will take some time to realize this, specially analysts who seem to be lagging stock movements by several months. But in the next couple of years I expect that a new Tesla reality will sink in.

