Electric car-maker Tesla has just released its Q1 financial results.
Adjusted earnings per share came in at $US0.12 per share, which was higher than the $US0.07 expected by analysts surveyed by Bloomberg.
During the quarter, the company produced 7,535 models S and delivered 6,457.
“While [deliveries] exceeded the average of seven analysts’ estimates, it was less than the highest estimate,” reported Bloomberg’s Alan Ohnsman.
The stock is down by around 6% in after-hours trading.
Management expects about 7,500 deliveries in Q2 and says its on track for 35,000 deliveries for the year.
“We are expanding our factory capacity to support increased Model S production later this year and the introduction of Model X next year,” said CEO Elon Musk.
“We still plan to invest $US650-850 million for the year in capital expenditures for increased production capacity, growth in our store, service center and Supercharger footprints, Model X and S development and start of Gigafactory construction,” said Musk. “With all these initiatives, we expect to be slightly free cash flow negative in 2014, before considering the equity required for leasing.”
Management expects gross margins to “increase slightly” from Q1 to Q2 and be “marginally profitable in Q2 on a non-GAAP basis.”
According to Bloomberg, analysts on average were forecasting the company to earn $US0.20 per share.
Tesla’s up 33% since the beginning of the year.
Why The Sell-Off?
Everyone’s still trying to figure out what it was about the announcement that has traders and investors disappointed.
From the looks of it, it’s probably the weak EPS guidance.
It’s worth noting that Tesla’s stock price is still up over 30% since the beginning of the year, which compares to the Nasdaq’s 2.6% decline. Tesla is also up 270% from a year ago.
That Direct-Sales Model
Tesla and its CEO Elon Musk got a lot of attention from the public and ire from car dealers for its direct-to-consumer sales model.
“While consumers and the vast majority of jurisdictions have overwhelmingly welcomed our direct-sales model, there are still a few states in the U. S. where we face resistance,” said Musk today. “In those states, we continue to fight to protect our customers’ ability to buy directly from Tesla. We believe strongly in the fairness of our position, which has been supported by a long list of consumer activists, economists and influential policy makers.”
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