Tesla (NASDAQ: TSLA) shares gained $67.51, or 11.62% to $648.50 in after-hours trading Wednesday after the company easily beat analysts’ expectations in the fiscal 2019 fourth quarter. The automaker also promised to raise its vehicle sales by more than a third in 2020.
The company, best known for its electric vehicles, reported earnings of $105 million, or $0.56 per share, in the latest quarter, compared with $140 million, or $0.78 per share, in the same period a year ago.
Excluding one-time items, Tesla earned $2.14 per share during the quarter, easily surpassing the $1.72 that analysts surveyed by Refinitiv were expecting.
Tesla generated revenue of $7.38 billion in Q4 2019, up 2% from the $7.2 billion the company had in the fourth quarter of previous fiscal year. Gross margin, a closely watched metric for Tesla, came in at 18.8% while operating margin stood at 4.9%.
Gross margin topped forecasts of 18.7% while operating margin fell short of Wall Street’s estimates of 5.2%. Free cash flow was $1.03 billion, well ahead of expectations of $429 million.
Tesla delivered a total of 112,000 vehicles in the quarter. For the full year, the Elon Musk-led company made 367,500 delivers, a 50% increase from a year ago. This is also in line with its own guidance for deliveries between 360,000 to 400,000.
Tesla said it expects to “comfortably” deliver more than 500,000 vehicles this year, helped by the ramp up of its new Model Y compact sport-utility vehicle in Fremont and Model 3 in Shanghai, China. Model 3 deliveries rose more than 45% year over year, according to the company.
Tesla is hoping to make first deliveries of the Model Y before April. The company also expects both solar and storage deployments to increase by at least 50% this year.
“We expect positive quarterly free cash flow going forward, with possible temporary exceptions, particularly around the launch and ramp of new products. We continue to believe our business has grown to the point of being self-funding,” Tesla said in its letter to investors.
“We expect positive GAAP net income going forward,” the company added, noting that “continuous volume growth, capacity expansion, and cash generation remain the main focus.”
Tesla company profile
Founded in 2003 and based in Palo Alto, California, Tesla is a vertically integrated sustainable energy company that also aims to transition the world to electric mobility by making electric vehicles. It sells solar panels and solar roofs for energy generation plus batteries for stationary storage for residential and commercial properties including utilities.
The Tesla Roadster debuted in 2008, Model S in 2012, Model X in 2015, and Model 3 in 2017. Global deliveries in 2018 were 245,506 units. Tesla went public in 2010 and employs about 50,000 people. – Warrior Trading News
