Tesla 1Q loss widens on increased spending ahead of Model 3
- Author: Zachary Reyes May 04, 2017,
May 04, 2017, 16:49
Analysts believe Tesla will lose about 82 cents a share on revenue of $2.61 billion for the first quarter - the Silicon Valley company lost 57 cents a year ago. However, shares of Tesla had dropped 6.4% on the next trading day (Tesla is reporting after market close) and remained down 8.6% from their price before the earnings release after one week and down 6.8% after one month. "One of our challenges will be to eliminate any misperception about the differences between Model S and Model 3", the letter noted. Analysts forecast that Tesla will post ($2.40) earnings per share for the current fiscal year.
"Tesla is on the verge of a major transition", said Karl Brauer, executive publisher for Autotrader and Kelly Blue Book, in an email to CNBC. "At some point that pattern has to reverse, though after 13 years who knows when it will happen". Keeping the sedan's arrival on course is essential to support Tesla's high-flying share price, which vaulted the company's valuation past the much larger and profitable General Motors Co. and Ford Motor Co. last month.
Tesla's mission statement is "to accelerate the world's transition to sustainable energy". The Model Y will also switch more vehicle systems to a new base voltage than what Musk called the "vestigial" 12-volt standard of gasoline cars. I mean, I'm sure there will be some funding rounds that happen in the future. He indicated his role could change long-term and be focused in areas such as product design or technology. Deliveries of 25,000 Model S and Model X vehicles in the first three months of the year were 69 percent higher than a year ago.
San Francisco: Tesla Inc. assured investors its highly anticipated Model 3 sedan is on track to begin production, mitigating concerns that the carmaker led by Elon Musk is burning through more cash to bring the vehicle to market.
Tesla is betting on the launch of its US$35,000 (NZ$50,8598) Model 3 midsize sedan to help meet its goal of producing 500,000 cars annually in 2018.
Tesla expects capital expenditure in the year to be slightly over $2 billion prior to the commencement of the Model 3 production. The company said it plans to open 100 retail and service locations worldwide this year, including its first stores in Dubai and South Korea.
Mr Musk has flagged plans to spend heavily during the first half of this year to bring out Tesla's most affordable vehicle to date. "And then I think that 1 million units is quite likely combined units, maybe more". Though, as the Model 3 begins production, it may face a bit of an optics problem - where it stacks up against the Model S. Tesla also acknowledged the problem in its earnings report. In 2017, Tesla expects to at least double the number of Superchargers and Destination Charging connectors globally to more than 10,000 and 15,000, respectively.
Tesla, Inc. (NASDAQ:TSLA) was up +1.76% ($5.44) to $314.07 and showed a volume of 4.47 mln shares. 5,382,777 shares of the company traded hands.