Still, having that gain account for roughly a quarter of the entire net income of a — forgive the repetition — car company might be.
At the very least, an investor might put a 10 times multiple on the regular profits but something much lower on the crypto-gain because of higher risk, volatility or so forth.
Tesla tends to emphasize its automotive gross profit margin as the figure to watch: This quarter’s was a robust 25.8%, or 21.1% once you strip out the regulatory credits.
That’s roughly the same as the third quarter of 2020, when Tesla reported $331 million — even though vehicle deliveries and revenue are 31% and 18% higher, respectively.
It also reflects the big drop in sales of Tesla’s higher-priced Models S and X as the company prepares to launch new versions.
For example, Tesla still led the global market by far in 2020, with a market share of about 24%.
And as traditional manufacturers launch their own electric models, so their demand for Tesla’s regulatory credits should wane.
But it is a problem if you have a market cap north of $700 billion and your margins are already thin and reliant on subsidies.