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In the letter, Elon stated they have burned through over $200m/month this year after the cost reductions from last year and January and again in March. (That's net $200m lost each month, not $200m spent each month.)

They raised $2.4 billion a few weeks ago, about half of which must go toward servicing existing debt, and had about $900m in the bank before the offering, leaving them about $2.1billion in cash.

Or in other words, 10 months of cash based on the trend established by the first 3 months of the year if they do not either cut losses, dramatically increase sales, or both.




Based on the burn rate as of 2018Q2 (~$720 million per quarter), they should already be bankrupt.

https://ir.tesla.com/static-files/7235e525-db16-470c-8dce-9e...

They aren't because things change and the burn rate for 2018Q2 didn't represent 2018Q3/Q4.


Context matters, as does reading comprehension. $200m/month = $600m/quarter...after 3 rounds of expense cutting.

That's $200m/month in net losses during a purely operational stage. It doesn't even include the costs of a planned Model Y launch or self-driving network.


Speaking of reading comprehension, of the $600 million/quarter you're referencing, nearly $200 million was from non-recurring items.

>In Q1, we experienced non-recurring items that negatively impacted our net loss by $188 million.

https://ir.tesla.com/static-files/b2218d34-fbee-4f1f-ac95-05...

The drop in S/X deliveries from the updates to their production lines, discontinuation of the 75kWh pack, and the pull-forward from Q4 of last year due to the reduction in the US tax credit also reduced profits by ~$300-400 million.

Like I said, a single data point doesn't make a trend.


Won’t they just get more funding?


The price is not attractive




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