Tesla Q1 Results: 10 Key Highlights

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Tesla Motors Inc (NASDAQ:TSLA) reported solid first quarter results on Wednesday. Earnings and revenues crushed the Wall Street estimates, but the stock plunged 8.73% to $183.89 in after-hours trading. The electric vehicle maker reported non-GAAP revenues of $713 million, up 27% YoY and well above the consensus estimate of $699.10. Excluding one-time items, earnings came in at $ 17 million or 12 cents a share. Let’s have a look at the 10 key highlights of Tesla’s first quarter results.

1: Tesla beats Model S delivery guidance

Tesla Motors Inc (NASDAQ:TSLA) delivered 6,457 vehicles in the first three months of this year, surpassing the guidance of 6,400 units. And yes, that includes the first vehicle delivered in China. The ASPs rose from $106K in Q4, 2014 to $110K in the first quarter. The company produced a record 7,535 cars in Q1. The company couldn’t deliver all the vehicles manufactured during the quarter because a large number of Model S cars are in transit to China and Europe.

2: Tesla expects to deliver 7,500 units in

The San Francisco-based electric vehicle company forecasts to deliver 7,500 Model S cars worldwide in the current quarter. Elon Musk said during the conference call that the company aims to produce 8,500-9,000 cars in Q2. Tesla Motors Inc (NASDAQ:TSLA) reiterated its full-year vehicle delivery guidance of 35,000 units.

3: Tesla ramps up production

The Elon Musk-led company has increased its manufacturing capacity by 15% to 700 units per week, compared to 6,00 vehicles a week in Q4, 2013. Tesla Motors Inc (NASDAQ:TSLA) is building a second production line to increase the production capacity to 1,000 units per week by Q4, 2014. The new production line is expected to become operational by the end of the third quarter. The company said battery cell supply remains a bottleneck in the manufacturing process.

4: Expect a soft second quarter

Tesla Motors Inc (NASDAQ:TSLA) forecasts second quarter revenues of $827 million. But the company will see only “marginal profitability” during the quarter. Perhaps that’s what disappointed investors, leading to a more than 8% decline in the stock. Wall Street expects 27 cents in earnings on revenues of $818.74 million.

5: Gross margins and ZEV credits

Gross margins for the first quarter improved slightly from 25.2% in Q4 to 25.4% in the latest quarter. Investors were expecting a bit higher non-GAAP gross margins. Anyway, Tesla Motors Inc (NASDAQ:TSLA) reiterated its full year gross margin guidance of 28%. As expected, the company reported zero revenues from zero emission vehicle (ZEV) credits. But other regulatory credit revenues came in at $12 million.

6: Gigafactory remains on schedule

Tesla Motors Inc (NASDAQ:TSLA) CEO Elon Musk said during the earnings call that the Gigafactory is on track for 2017 completion. The lithium-ion battery factory will reach its full capacity by 2020. Musk said that the company hasn’t yet finalized the ultimate location for the factory. But it will be built on two locations to minimize the risk.

7: Model X to be launched in Q2, 2015

No, the Model X crossover won’t be delayed any further. Elon Musk said that the new vehicle is on track to be launched in the second quarter of 2015. Advance bookings for the Model X are in full swing.

8: New retail stores

Despite facing hurdles in some states, Tesla Motors Inc (NASDAQ:TSLA) said it will increase the number of retail outlets by at least 75% from FY2013 to FY2014. It shows that the company is unwilling to adopt the dealership model.

9: Supercharger network

Tesla Motors Inc (NASDAQ:TSLA) recently opened its 100th Supercharger station in New Jersey. The company said it plans to install 200 more Superchargers worldwide this year. Tesla has partnered with China’s Sinopec to build Superchargers in the country.

10: China

The San Francisco-based company has started selling vehicle in China. And it has received widespread support from all corners of the nation. The Shanghai government has announced that Model S drivers will be entitled to free license plates in the city (saving them $10K-15K in auction price). Local governments are also welcoming the expansion of the Supercharger network. Elon Musk said demand in China is strong, and the company will have to build a production unit in the country in the next 3-4 years.

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