Tesla Reports Earnings Monday. There’s Almost Too Much to Watch.

Tesla reports net connected Monday, July 26.

Dean Mouhtaropoulos/Getty Images

There volition beryllium a batch of moving parts, however, adjacent much than accustomed for the world’s astir invaluable car company and its iconoclast CEO Elon Musk.

Factors that volition lend to bottom-line net see the planetary semiconductor shortage, vehicle pricing, conveyance gross nett margins, and the level of profitability successful Tesla’s artillery retention business. In the end, however, investors volition privation to spot a grounds successful operating profits—no substance however it happens. That’s what could interruption shares retired of their caller range.

Tesla reported much than $800 cardinal successful operating profits successful the 2020 3rd quarter, and the banal much than doubled to astir $860 successful the three-month span that followed. But since operating nett maturation mostly paused successful the consequent quarters, shares person traded down from astir $860 to astir $640 recently. Profit stagnation has meant banal stagnation, too.

The bully quality for Tesla bulls is Wall Street is projecting a caller record: Operating nett is expected to beryllium $835 cardinal for the 2nd quarter, driven by beardown deliveries. The 2021 2nd 4th marked the archetypal clip Tesla delivered more than 200,000 vehicles successful a azygous quarter.

After net are digested, determination should beryllium endless arguments among bulls and bears astir the prime of earnings. For instance, 1 mode Tesla generates income is by selling regulatory credits—which it earns by producing much than its just stock of electrical vehicles. The institution generated $518 cardinal successful first-quarter recognition sales, which helped Tesla beat earnings estimates. There is ever statement astir what is the “normal” magnitude of recognition income and erstwhile volition those income adust up. Eventually, some the bulls and bears expect different car makers to merchantability their ain EVs, cutting disconnected that root of gross for Tesla.

There is besides the contented of Bitcoin. Tesla recognized a tiny summation connected its Bitcoin holdings successful the archetypal quarter, but the cryptocurrency’s prices person fallen by astir fractional since their April peak. That means determination is simply a accidental of a tiny loss. How investors respond is anyone’s guess, but don’t expect Tesla to merchantability retired of its Bitcoin position. Musk continues to bespeak his institution volition transact successful the cryptocurrency erstwhile Bitcoin mining uses much sustainable power.

Investors volition besides privation to cognize erstwhile Tesla’s caller Germany works and Austin, Texas installation volition commencement delivering cars. The Austin works volition physique Tesla’s Cybertruck. There volition besides apt beryllium questions astir advances successful Tesla’s driver-assistance functions—the institution precocious started selling its driver-assistance bundle as a subscription—and however overmuch wealth the institution could marque from its charging network. Musk tweeted this week Tesla would unfastened its charging network to different EVs down the road.

Those topics and much should beryllium discussed connected the net conference call scheduled for 5:30 p.m. ET connected Monday. Year to date, Tesla banal is down astir 9%, trailing down comparable 17% and 15% respective gains of the S&P 500 and Dow Jones Industrial Average. Still, Tesla shares person had a beardown run, up astir 112% implicit the past 12 months.

Write to Al Root astatine allen.root@dowjones.com