As Tesla's (NASDAQ: TSLA) stock hangs in negative territory for the year, Elon Musk and his team report their second quarter earnings with a larger than expected loss. But, is this all bad news for the electric car maker?
Tesla's second-quarter loss grew nearly 60 percent to $293 million as the company reported that it delivered fewer vehicles than planned. Despite this the company says that it remains on track to increase production in the second half of this year and introduce a new car in 2017.
The company's CEO, Elon Musk said issues with suppliers were among the reasons for the agonizing ramp-up in production for the Model X SUV, which went on sale last Autumn. Complicated parts, like the SUV's gull-wing doors and free-standing second-row seats, were also issues.
So here's the details -
The company produced 18,345 vehicles during the April-June period, a quarterly record, but many were produced so late in the quarter that it delivered only 14,402, which was short of its goal. Initial reaction to the report did not take this into consideration.
Tesla's second-quarter loss, of $2.09 per share, compared to a loss of $1.45 per share in the same quarter a year ago. The 13-year-old company has only reported one profitable quarter, in 2013.
Revenue rose 33 per cent to $1.27 billion. Tesla said the average price of its new Model X SUV is more than 15 per cent higher than the Model S sedan.
Something to consider for next quarter -
Tesla said on Wednesday 5,150 vehicles were still in transit at the end of the quarter and would be delivered early in the third quarter. It expects to deliver just under 80,000 vehicles worldwide this year, up from 50,500 in 2015.
The company said it was making 2,000 vehicles per week by the end of the second quarter, and believes it can crank that up to 2,200 vehicles by the end of the third quarter and 2,400 vehicles by the end of this year.
As for the number of reservations (a statistic frequently referenced by analysts), Tesla wouldn't give an updated number on Wednesday's conference call. Instead it reiterated the total of 373,000 that it released in May.
So basically -
You have a little bad news along with more projections of a better and stronger future. This leaves the bulls and the bears roughly tied for the moment with shares staying inside of a three month range following the earnings announcement. At least for now analysts remain split on future projections.