Tesla Motors Inc (TSLA) Smashes Earnings Estimates

Tesla Motors Inc (TSLA) Smashes Earnings Estimates
<a href="https://pixabay.com/users/Blomst/">Blomst</a> / Pixabay

Tesla Motors Inc (NASDAQ:TSLA) released the results from its most recently completed quarter, posting earnings of 11 cents per share, excluding items. Non-GAAP revenue was $858 million, while GAAP revenue was $769 million. Analysts had been expecting to see non-GAAP earnings of 4 cents per share, excluding items, or net losses of $55 million. They were looking for $810.57 million in sales. Tesla’s reported second quarter GAAP net losses were $62 million or 50 cents per share.

Breaking down Tesla’s earnings report

The automaker reported that the average selling price of the Model S was flat with the first quarter. Tesla reported $23 million in powertrain sales to Toyota Motor Corp (ADR) (NYSE:TM) (TYO:7203) and Daimler AG (OTCMKTS:DDAIF) (ETR:DAI). The company also noted that they began business leasing for the Model S in the U.S. during the second quarter. Non-GAAP automotive gross margin was 26.8%, while GAAP gross margin was 26.9%. Tesla spent $93 million in non-GAAP research and development expenses and $108 million on a GAAP basis.

Li Lu In New Interview: China Is Full Of Opportunities For “Patient Investors” Who “Know The Value Of Businesses”

Li LuRecently, Bruce Greenwald carried out a virtual Fireside Chat with Li Lu, the founder and chairman of Himalaya Capital. Greenwald and Lu covered multiple topics during the discussion, addressing everything from the value investor's approach to appraising businesses and what he had learned from his great friend Charlie Munger. The duo also discussed China's economy Read More

Tesla had previously guided for 7,500 deliveries during the quarter and 35,000 deliveries for the full year. The automaker ended up delivering 7,579 Model S sedans, a 17% sequential increase. For the second quarter, some analysts had projected as many as 7,800 deliveries. The automaker said wait time for its cars lengthened because their production growth has not been able to keep pace with increased demand. Tesla produced 8,763 cars during the quarter.

Tesla updates deliveries

Investors and analysts have been concerned about Tesla’s deliveries, especially in Europe, where some believe the automaker’s deliveries have plateaued. In North America and Europe, Tesla reported that orders “increased sequentially at a much faster rate than for the rest of the automotive industry.” The automaker also said it is doubling its total global addressable market by entering China and also right hand drive markets.

China has been a hot topic of conversation because it is the world’s biggest luxury car market. Tesla said they are off to a “very encouraging start” there. They plan to launch services and deliveries in a number of other cities in the coming months.

Tesla guides for third quarter

Looking ahead to the next quarter, Tesla Motors said it plans to produce about 9,000 cars, taking into account the two-week shutdown of production as it transitions to a new assembly line. The automaker said it would have been able to produce 11,000 cars if it hadn’t been for that shutdown. They expect to deliver approximately 7,800 Model S sedans in the quarter.

Management projects non-GAAP automotive gross margins to be about flat. They continue to expect a 28% non-GAAP automotive gross margin by the fourth quarter. Tesla projects about 300 leased cars during the quarter and “much more” in the fourth quarter.

For next year, management expects their annualized delivery rate to surpass 100,000 units.

Other news from Tesla

Investors have been wanting to hear more about the plans for Tesla’s massive gigafactory. One of the key topics of conversation has been the location. Several states have been vying for the factory, which is expected to create 6,500 jobs. Tesla said tonight that it broke ground at a site outside Reno, Nev. in June. The company plans to break ground on multiple sites to ensure that the gigafactory is completed in time for production of the Generation III car, but so far, it has not selected any other sites. Tesla said it is still looking at potential sites in Arizona, California, New Mexico and Texas. Management said they will select the final site for the first fatory “in the next few months.”

This morning, Panasonic Corporation (ADR) (OTCMKTS:PCRFY) (TYO:6752) officially confirmed that it will partner with Tesla in the gigafactory. The battery cell maker said it will be the principle partner and that it will occupy approximately half of the facility, with Tesla itself and the two companies’ suppliers occupying the other half. Panasonic will manufacture the cells for the batteries, which Tesla Motors will build on site.

No posts to display