1. Tesla's Mixed Q2 Results: "Affordable" Electric Vehicle Expected Next Year

Tesla reported Q2 revenue of $25.55 billion, exceeding expectations and the same period last year; adjusted earnings per share (EPS) were $0.52, below expectations; non-GAAP net profit was $1.8 billion. Tesla indicated that the company's growth rate this year will be "significantly lower" than last year's growth rate. The company is on schedule to produce a potentially more affordable electric vehicle in the first half of next year. Tesla did not disclose when it will launch the Robotaxi, but stated that the vehicle will adopt a "box-less manufacturing strategy." Previously, in its Q2 production and delivery report, Tesla disclosed a battery energy storage of 9.4GWh, the highest ever quarterly volume, more than double the battery energy storage deployed in the first quarter. Morgan Stanley called this data a "spotlight stealer," noting that it is twice their forecast. After the financial report was released, Tesla's stock price fell sharply in after-hours trading.

Yi Yuan Investment's Jian Jia: The financial report shows that Tesla's Q2 revenue set a record, but net profit and EPS have declined significantly year-on-year. Free cash flow increased year-on-year but fell short of expectations. The energy business grew strongly, while car sales continued to decline. The company did not disclose new information about the self-driving taxi Robotaxi but confirmed that the release time has been postponed to October; the affordable model is expected to be unveiled in the first half of next year. Investors are concerned about Tesla's execution of AI projects such as Robotaxi and humanoid robot Optimus, believing that this will be the main driver of the company's future growth.

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Associate Professor Li Huihui from the University of Hong Kong ICB: Tesla's Q2 financial report shows mixed results. Although the total revenue exceeded expectations, EPS fell short of expectations. This result reflects the cost pressure and profitability challenges Tesla faces in its rapid expansion. The electric vehicle delivery volume exceeded expectations but decreased year-on-year, showing pressure on the demand side and intensifying market competition. However, its energy business performed brightly, with a record deployment of energy storage products. We believe that Tesla's future growth points need to shift to the energy business and emerging technologies, especially in the layout of energy storage and artificial intelligence such as Autopilot and full self-driving technology. In addition, the diversified layout of the global market will also be an important driving force for Tesla's future growth. The stock price may fluctuate in the short term due to underperformance, but we believe that Tesla's long-term investment value remains strong.

Qian Qiming, Executive General Manager of Shenwan Hongyuan Securities Research Institute: The automotive industry is highly competitive, and performance decline may not be an exception. Tesla has both opportunities and challenges, and technological innovation is its winning weapon. The current global electric vehicle industry trend is stable and upward, and related sectors are worth paying attention to.

2. Alphabet's Q2 Profits Exceed Expectations, Cloud Business Booms, AI Losses Expand

Google's parent company, Alphabet, reported Q2 revenue of $84.7 billion and earnings per share of $1.89, which is a significant increase compared to the same period last year and exceeds analyst expectations, as its cloud business continues to accelerate, and operating profit has broken through the $1 billion mark for the first time. Alphabet's cloud computing revenue was $10.35 billion, with operating income of $1.17 billion. The report stated that Alphabet invested $2.2 billion in building AI models in its DeepMind and Google Research departments in Q2, which is higher than the $1.1 billion in the same period last year, but it is still unknown when AI will start generating revenue for Google's cloud business (let alone its advertising business). Q2 advertising revenue reached $64.6 billion, exceeding expectations, but YouTube advertising revenue was not satisfactory. After the financial report was released, Alphabet's stock price fluctuated slightly and then rose, and then fell back.

Yi Yuan Investment's Jian Jia: Alphabet's Q2 revenue and earnings per share both exceeded expectations, with year-on-year growth, but revenue and profit growth fell sequentially; YouTube advertising revenue did not meet expectations, but cloud business and core advertising business grew year-on-year, showing a solid improvement trend. The market is concerned about the role of AI technology in promoting the company's business and the impact of AI investment costs on profit margins. The company's CEO Pichai emphasized the importance of AI to the company. In addition, Alphabet faces uncertainties such as antitrust lawsuits, elections, and AI capital expenditure cycles, and the operational progress of Waymo is also a focus of market attention.

Associate Professor Li Huihui from the University of Hong Kong ICB: Google's parent company, Alphabet, exceeded market expectations in its Q2 financial report, mainly benefiting from strong growth in advertising revenue and cloud business. Its advertising business is still the main source of revenue, but as the market becomes saturated, a slowdown in growth is inevitable, and new growth points need to be sought outside the advertising business. We believe that the growth momentum of the cloud business is good, but there is still a significant gap compared to Amazon and Microsoft. The company needs to increase investment in the field of cloud computing to increase market share. Secondly, Google's progress in generative AI, especially Bard and its expansion in enterprise applications, will become an important driving force for future growth. In addition, Google's attempts in the hardware field, such as Pixel phones and smart home devices, have not yet formed a scale effect. The company should consider mergers and acquisitions or strategic cooperation. It is recommended to pay attention to its continuous innovation and expansion in the fields of cloud computing and AI, and to be optimistic about Alphabet's long-term investment value.

Qian Qiming, Executive General Manager of Shenwan Hongyuan Securities Research Institute: Alphabet's profits are growing rapidly, and the company is increasing R&D investment, with promising momentum. Technology stocks have a medium to long-term layout logic, and opportunities for wave adjustments can be paid attention to.③ Musk Builds Ultimate AI with 100,000 Nvidia H100 GPUs

Musk posted on X early yesterday morning, announcing the launch of "the world's most powerful AI training cluster"—the Memphis Supercluster by xAI company. He plans to use this cluster to create "the world's most powerful AI" before December this year. The Memphis Supercluster consists of 100,000 liquid-cooled Nvidia H100 GPUs connected on a single RDMA (Remote Direct Memory Access) structure for AI training. Musk also previously revealed that the supercluster will be used to train the third generation of xAI's large language model, Grok 3. It is reported that xAI's first-generation large language model, Grok 1, was launched in November last year, and Musk announced this month that Grok 2 will be launched in August. In terms of the scale of computing resources, the Memphis Supercluster easily surpasses the current most powerful supercomputers on the market in terms of GPU computing power, such as Frontier (37,888 AMD GPUs), Aurora (60,000 Intel GPUs), and Microsoft Eagle (14,400 Nvidia H100 GPUs). However, Meta revealed in January that the company plans to purchase 350,000 Nvidia H100 GPUs by the end of this year, expanding its AI infrastructure's computing power to the level of 600,000 H100s.

Mi Yuan Investment Jian Jia: It is possible to continue to focus on the xAI team or the third-generation large language model Grok-3 that may be released at the end of the year. With the development of AI technology, computing power has become a battleground for tech giants, and industries related to computing power will flourish.

Shenwan Hongyuan Securities Research Institute Executive General Manager Qian Qiming: The competition for AI large models is fierce, and the development prospects are enormous. As AI applications gradually take root in China, investment opportunities will arise on the computing power side.

④ Coca-Cola Raises Full-Year Guidance, Stock Price Hits Record High

Coca-Cola's second-quarter revenue increased by 3% year-on-year to $12.36 billion, and the comparable earnings per share (Non-GAAP) increased by 7% year-on-year to $0.84, both exceeding market expectations. However, the adjusted net profit fell by 28.8% year-on-year to $2.41 billion. The gross margin was 61.1%, 2.1 percentage points higher than the same period last year. In terms of sales, North American sales were weak, while the Asia-Pacific and Latin American markets saw strong growth. The global price increased by 9% year-on-year, but about half of it came from markets with hyperinflation such as Argentina. The company raised its guidance for the full year, expecting a 9%-10% increase in full-year organic revenue (Non-GAAP) and a 6% increase in comparable earnings per share. However, it is expected that the third-quarter comparable net sales will be adversely affected by a 4% currency impact, and its comparable earnings per share will be adversely affected by an 8% currency impact. Coca-Cola's stock price hit a record high overnight before falling back, closing at $64.95, up 0.28%.

Mi Yuan Investment Jian Jia: Coca-Cola's second quarter not only exceeded market expectations in both revenue and earnings per share but also raised its forecast for the full-year performance. The main driver of Coca-Cola's performance in the previous quarters was the rising prices, and now the increase in earnings per share is more driven by the improvement in profit margins due to the alleviation of cost pressures. Coca-Cola's brand value in beverages is stronger than Pepsi's, so it is more successful in raising prices while maintaining sales volume. Coca-Cola's financial report did not mention content related to weight loss drugs.

Shenwan Hongyuan Securities Research Institute Executive General Manager Qian Qiming: Coca-Cola's revenue increased but profit did not, and performance is still the foundation of enterprise development. Companies with better-than-expected mid-year performance and in advantageous categories can be focused on.

⑤ Porsche Lowers Full-Year Revenue Forecast, Downplays Electric Vehicle Sales Target

Porsche will announce its first-half performance today, but the company lowered its full-year revenue forecast to €39-40 billion yesterday. Affected by this news, Porsche's European stock price fell by 5% on Tuesday. Porsche explained that due to a flood at a European supplier's factory, the company faces an unexpected shortage of special aluminum alloy supply, which will lead to a reduction in production. In addition, the company is also facing a dilemma of weak demand for electric vehicles. Porsche stated that the company's product strategy is to be able to deliver more than 80% of pure electric vehicles by 2030, depending on customer demand and the progress of electric vehicles. Previously, Porsche set a target for electric vehicle sales to account for 80% of new car sales by 2030. Its latest statement downplays this ambitious transformation goal. In recent months, car manufacturers such as Mercedes-Benz and Renault have indicated that the sales targets for pure electric vehicles they set for the next decade in recent years are too ambitious, as consumers are still reluctant to give up gasoline cars. According to the latest data from the European Automobile Manufacturers Association, the sales of electric vehicles in the EU decreased by 1% to 156,400 last month.Miyao Investment's Jian Jia: Porsche's first-half electric vehicle sales fell by 51% year-on-year, with a 33% decline in the Chinese market and a 7% decrease in global deliveries. The company has revised down its revenue forecast for 2024. Additionally, Porsche faces challenges in the electric vehicle sector, with continued sluggish sales despite its push for electrification.

Qian Qimin, Executive General Manager of Shenwan Hongyuan Securities Research Institute: The penetration rate of new energy vehicles is rapidly increasing, with domestic electric vehicle sales being impressive. Attention should be given to car manufacturers with technological advantages in the context of intelligentization.