GLJ’s Gordon Johnson: “Bitcoin is going to be a headwind for Tesla in Q2”
- Gordon Johnson expects Tesla to take an $85 million charge on its BTC investment in Q2.
- The GLJ expert highlights that Tesla lost market share in China and Europe in the second quarter.
- Ahead of the earnings on Monday, Tesla stock is down about 25% from its year-to-date high in January.
Since the stock is down about 25% from its record high in January, investors are now thirsty for bullish indications – ones that didn’t come from Gordon Johnson’s interview with CNBC’s “Worldwide Exchange” on Monday.
Gordon Johnson’s remarks on CNBC’s “Worldwide Exchange”
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The GLJ Research founder and CEO discussed several factors that could weigh on Tesla’s Q2 earnings report, its Bitcoin investment being one. In his interview, he said:
“They’re going to take an about $85 million charge on the BTC investment they made in the second quarter. So, bitcoin is actually going to be a headwind for them in Q2. It’s going to work against the company, not for them.”
BTC climbed sharply to over $39,000 on Monday, but Johnson stands his ground, highlighting that one big jump on a single day won’t be sufficient to help Tesla.
Tesla lost market share in China and Europe
Johnson also expects a hit to margin this quarter since Tesla resumed Model S and X production versus last quarter when it didn’t produce the two flagship vehicles. Credit sales are likely to be down by $200 million as well, compared to Q1 related to Stellantis that stopped buying credits from the electric vehicle maker in the second quarter.
The GLJ expert pointed out that Tesla in Q2 lost market share significantly in China and Europe – two of the three largest global markets. Reiterating his sell rating on the stock, he predicted $985 million of net income for Tesla in the recent quarter versus the Street consensus of $1.1 billion.
Ahead of the earnings, shares of the Palo Alto-based company are about 3% up on Monday.