Tesla Slumps Despite Record Quarterly Revenue


Tesla Inc. (NASDAQ: TSLA)

Tesla on Wednesday announced its second straight quarterly profit for the first time since debuting on the Nasdaq stock market almost nine years ago. The company said it expects to report profits in each quarter of calendar, but warned that it will be difficult to make a profit during the first quarter as it enacts cost cuts of up to $400 million.

The cuts represent about 7% of the automaker’s global workforce, and are expected to deal a dent to its earnings. Tesla posted $7.23 billion in revenue from October to December, a record for the company.

Shares of the automaker rose 3.8% to $308.77 during the regular trading session, but lost $15.42, or 4.99% to $293.35 in post-market hours after the earnings report.

TSLA Earnings & Outlook

The Palo Alto, California-based company reported net income of $139.48 million, or $0.78 per share in the fourth quarter, up from a loss of $675.4 million in the earlier-year period. Earnings, adjusted for items such as stock option expenses, were $1.93 per share for the quarter. Analysts surveyed by FactSet expected adjusted earnings of $2.20 a share for the period.

The company posted record fourth-quarter revenue of $7.23 billion, slightly beating analysts’’ expectations of $7.12 billion. Tesla’s cash position at the end of 2018 stood at $4.28 million, an improvement of $753 million. At the end of the year, the electric car maker had $9.4 billion in debt, a slight improvement on year-over-year basis.

Tesla said it expects to deliver between 360,000 to 400,000 vehicles in 2019, which would be a growth rate of 45% to 65% compared with last year.

Tesla CEO Comments

CEO Elon Musk said in a letter to investors, “Model 3’s production rate progressively improved through Q4, with December 2018 being our highest volume month ever. In our Fremont facility, we are now past the steep portion of the production S-curve, and we expect our production rate to continue to gradually improve.”

“Every part of the Model 3 production process has demonstrated over a 24-hour period the ability to produce at an extrapolated rate of 7,000 vehicles per week. By the end of this year, we expect to be able to produce Model 3 at this rate on a sustained basis.”

Tesla, Inc. Profile

Tesla, Inc. engages in the design, development, manufacture, and sale of fully electric vehicles, energy generation and storage systems. It also provides vehicle service centers, supercharger station, and self-driving capability. The firm operates through Automotive, and Energy Generation and Storage segments. The Automotive segment includes the design, development, manufacture and sale of electric vehicles.

The Energy Generation and Storage segment includes the design, manufacture, installation, sale, and lease of stationary energy storage products and solar energy systems, and sale of electricity generated by its solar energy systems to customers. The company was founded by Jeffrey B. Straubel, Elon Reeve Musk, Martin Eberhard, and Marc Tarpenning on July 1, 2003 and is headquartered in Palo Alto, CA. – CNN Money