Tesla Reports Lower-Than-Expected Q2 Loss

Revenue increases 56% to $1.2 billion but Tesla's reduced outlook for deliveries this year disappoints Wall Streeet.
Matthew HellerAugust 5, 2015
Tesla Reports Lower-Than-Expected Q2 Loss

Tesla Motors on Wednesday released better-than-expected earnings for the second quarter but its shares fell as the auto maker cut its forecast for 2015 deliveries.

Tesla’s second-quarter adjusted loss of $61 million, or 48 cents a share, on sales of $1.2 billion beat analysts’ estimates of an adjusted loss of 60 cents a share on sales of $1.19 billion. During last year’s second quarter, Tesla made $0.11 per share but this year’s revenue was up more than 50% from $769.35 million.

“Simply put, in a choice between a great product or hitting quarterly numbers, we will take the former,” Tesla said in a letter to shareholders. “To build long-term value, our first priority always has been, and still is, to deliver great cars.”

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But Tesla disappointed Wall Street by estimating that it will sell between 50,000 and 55,000 cars this year, backing off its earlier estimate of 55,000. The stock fell more than 7% in after-hours trading after closing with a 1.5% gain at $270.13.

The company explained that while equipment installation and final testing of its new Model X “is going well, there are many dependencies that could influence our Q4 production and deliveries.” Among other things, since Model S and Model X cars are produced on the same general assembly line, Model X “production challenges could slow Model S production.”

Tesla sold 21,537 vehicles through the first half of 2015. The company said it still expects Model X deliveries to begin late in the third quarter.

According to Business Insider, Model X sales aren’t expected to make a major contribution to Tesla’s 2015 goal — probably less than 5,000 vehicles, assuming the launch goes off without any hitches. “That means delivering over 25,000 Model S sedans by the end of the year is critical,” Business Insider said.

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