Kelly Evans: Bitcoin-Adjusted Earnings Season

CNBC

You know I got a big chuckle last night out of the fact that Tesla's Bitcoin sales contributed about $100 million of the $400 million in net profit it reported for the quarter. But the more you dig into Tesla's results, the more interesting the story gets. 

To quickly summarize, here's the bear case

     > Minus Bitcoin and subsidies/tax credits, Tesla actually lost almost $200 million in the quarter; 

     > It's under scrutiny for this month's fatal crash that may have involved some aspect of Autopilot...

     > Elon has been promising full self-driving (which could unleash big profits to car owners) was imminent since at least 2019...

     > The biggest Tesla news at the key Shanghai auto show last week was the protestor jumping on a Tesla car wearing a "brake failure" t-shirt; and 

     > YouTubers are bailing now that Tesla has stopped giving away free stuff to those with big "referral credits," and are promoting other EVs  

But now, here's the bull case

     > Tesla's profits would have been a lot higher without $300 million of Musk's executive comp...

     > The Model 3 is now the world's best-selling luxury sedan 

     > Tesla's automotive profit margins rose by a point to 26.5%

     > Auto margins and profit for the quarter would have been even higher without $200 million of charges related to changeovers for the Model S and Model X, and

     > Last quarter is its seasonally weakest, with the company also facing "some of the most difficult supply chain challenges that we've ever experienced," as Musk said. 

Bottom line, Tesla appears to be getting leaner and meaner as a carmaker just in time for heightened EV competition. I like Whitney Tilson's line: Tesla "is a bad short...and a bad long!" But let's not forget, we're all long it if we own the S&P 500 in our retirement accounts. 

 See you at 1 p.m! 

Kelly

Twitter: @KellyCNBC

Instagram: @realkellyevans

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