Tesla reports both record revenue and record losses

Tesla had a record first quarter in 2018. It generated $3.4 in revenue, it’s highest ever but also spent more money than ever before, at nearly a $785 million loss. Tesla was expected to report a loss of $3.48 a share but instead only reported losses of $3.35 per share.  It also set a record for the number of cars Tesla made in the first quarter at a pace of 2,200 per week

Tesla CEO, Elon Musk, said that the company will not raise more capital at this time because it wasn’t needed. Instead, to increase its capital, Tesla is expected to improve the production of their Model 3 car. With these upcoming changes, Tesla reports that it expects it will earn a profit in the second half of the year.

Tesla has not reached its goal of producing 2,500 Model 3 sedans each week by the end of March. In a letter to investors, Tesla stated that they were able to produce 2,270 cars three weeks in a row in April.

Tesla has been spending money on improving its Fremont, California plant and at its Gigafactory 1. In order to increase production of the Model 3, Fremont factory will run continuously, according to a leaked email sent by Musk. Due to more employees, shifts, and increased overtime payouts, Tesla’s costs have increased.

Musk and CFO Deepak Ahuja wrote a letter to investors about the second half of 2018 and anticipated sales. “Even at this stage of the ramp, Model 3 is already on the cusp of becoming the best-selling mid-sized premium sedan in the US, and our deliveries continue to increase,” Musk and Ahuja wrote. “Consumers have clearly shown that electric vehicles are simply more desirable when priced on par with their internal combustion engine competitors while offering better technology, performance and user experience.”

If Tesla is able to hit its goal of 5,000 Model 3 cars produced per week, Tesla can expect to earn a profit in Q3 and Q4.

Like this article? Get updates by email and get our eBook for FREE

Lindsey Conger on InstagramLindsey Conger on Twitter
Lindsey Conger
Associate News Writer: Lindsey is a writer originally from Chicago but can now be found somewhere in Europe. She is driven by a passion to explore every corner of the world, spread her marketing and business knowledge, and to be able to speak Spanish fluently. Follow her on Instagram at @lindseyaconger

Article Tags:
Article Categories:
Finance · US & World
44

Associate News Writer: Lindsey is a writer originally from Chicago but can now be found somewhere in Europe. She is driven by a passion to explore every corner of the world, spread her marketing and business knowledge, and to be able to speak Spanish fluently. Follow her on Instagram at @lindseyaconger

Leave a Comment

Your email address will not be published. Required fields are marked *