Tesla recorded net income of $21.9 million, or 14 cents per share, for the third quarter ended September 30 compared with a loss of $229.9 million, or $1.78 per share, a year earlier. Importantly, Tesla receives all cash upfront for third-party leases, and we expect cash flow to ramp as the company continues to increase deliveries.
Advertisement
This could be the first quarter in which Tesla reports an operating profit, though it is expected to be small at just $3.36 million.
At first glance it is hard not to be impressed with results released Wednesday by Tesla Motors.TSLA -0.05 % .
Illustrating how impressive Tesla’s performance was this past quarter, Wall St. was anticipating Tesla to post a loss amid $1.9 billion in revenue for the quarter. Tesla also said there were a further 5,065 vehicles on their way to customers.
“Management asserted that it would not need to raise cash, but our model forecasts Tesla ending 2018 with $575 mln, which we think is too close for comfort”, Cowen and Co analyst Jeffrey Osborne said in a note.
There are also questions about the integration of SolarCity, which lost $55.5 million in the second quarter.
Tesla can maintain its net income for the fourth quarter without the the credits, said Tesla CEO Elon Musk. The company said it delivered 24,821 vehicles during the quarter, surpassing an earlier estimate of 24,500 vehicles.
Model S and Model X vehicles with the new hardware are ‘already in production’.
Musk’s plan to merge electric automaker Tesla and renewable energy company SolarCity (SCTY) is “tying two sinking ships together for synergy”, he said. Tesla had earlier said it expected to spend $2.25 billion on capital expenses this year. During yesterday’s Q3 earnings call, Musk confirmed that no additional capital raise is needed by end of year and “probably not” needed in Q1.
Tesla’s shares were up by 3.5% after they announced their positive quarterly results.
After the proposed deal, independent research team Argus had downgraded Tesla from a “buy” to a “hold”. If Musk does seek to tap the markets for money, then a leaner capital spending plan and the third-quarter profit could assist in greasing the wheels, says Reuters.
Advertisement
It’s safe to say Bob Lutz , who spent almost 50 years working at established automakers, does not think much of Tesla (TSLA) and its co-founder Elon Musk .
