Tesla Motors Inc Stock Surges On Delivery Guide

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Tesla Motors Inc Stock Surges On Delivery Guide
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Tesla Motors released its third quarter earnings report after closing bell tonight, posting non-GAAP losses of 58 cents per share on $1.24 billion in non-GAAP revenue, almost a 33% year over year increase. Analysts had been expecting losses of 50 cents per share and revenue of $1.26 billion.

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Tesla margins under pressure

GAAP net losses were $1.78 per share.

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Tesla’s non-GAAP automotive revenue was $1.16 billion, including $853 million in GAAP Automotive revenue and $307 million in deferred revenue due to lease accounting, which the company said was more popular in North America during the third quarter. Tesla leased 494 cars directly to customers during the quarter.

Non-GAAP gross margin was at 25.1%, while GAAP gross margin was 24.7%. It was expected that the automaker would begin facing headwinds to margins as it ramps production of the Model X. The non-GAAP automotive gross margin was 23.7% excluding $39 million in Zero Emission Vehicle credits and 22.8% in GAAP revenue. Services and Other revenue increased 62% year over year to $84 million.

Tesla surpasses its own delivery expectations

Tesla delivered 11,603 vehicles and produced 13,091 vehicles during the third quarter. The automaker had set a tall order for itself by guiding for the delivery of 50,000 to 55,000 cars for 2015 and did not make an adjustment to that guide in its second quarter earnings report.

Tesla updates guidance

During the fourth quarter, Tesla expects to build between 15,000 and 17,000 vehicles and deliver between 17,000 and 19,000 vehicles. That would put it within the low end of its original guided range at between 50,000 and 52,000 vehicles.

Analysts have generally been expecting management to revise that number downward for some time in light of the steep ramp that would have to happen in the last few months of the year in order for Tesla to meet that guidance. Barclays analysts said before tonight’s earnings report that they expected the company to cut its full year guidance to 45,000 cars for this year.

As of this writing, shares of Tesla Motors were up 8.48% at $226.01 per share.

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Michelle Jones is editor-in-chief for ValueWalk.com and has been with the site since 2012. Previously, she was a television news producer for eight years. She produced the morning news programs for the NBC affiliates in Evansville, Indiana and Huntsville, Alabama and spent a short time at the CBS affiliate in Huntsville. She has experience as a writer and public relations expert for a wide variety of businesses. Email her at Mjones@valuewalk.com.
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