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Tesla Profits: Be Careful What You Wish For

02 August, 2018, 11:18 | Author: Melinda Barton
  • Tesla Model 3 interior touchscreen

However, CEO Elon Musk promised net profit in the second half of the year as production of the Model 3 ramps up.

During the same quarter a year-ago, Tesla saw its Q2 revenue hit $2.79 billion while posting a loss of $1.33 per share.

Tesla said it expects to increase Model 3 production to 6,000 per week this month, buoying expectations that the electric vehicle maker will meet its goal of profitability and positive cashflow in the next two quarters. He also said that production efficiencies should rise as more Model 3s are built, and he said that he expects to make to around 750,000 vehicles in calendar year 2020. Analysts polled by FactSet expected a $US2.88 loss per share.

"It's really kind of a mind-blowing leap forward", Mr Musk said on a call with financial analysts.

During the second quarter, Tesla laid off 9 percent of its workforce as it worked toward Musk's promise of making money. Its shares surged after the close of regular trading.

Tesla said its weekly production rate reached the 5,000 mark for the Model 3, plus a combined 2,000 for the Model S high-end sedan and the Model X SUV, for "multiple" weeks in July.

Tesla projected 2018 capital spending of slightly less than $2.5 billion, compared to $3.4 billion previous year. Other games could certainly be possible (we'd love to see Night Driver), and with Musk's shout-out to Atari in the tweet it would seem the long-time computer company is on-board with the fun.

Musk said it will cost the same amount as systems Tesla now puts in its cars, but will bring much more processing power.

During last month's quarterly conference call, Musk dismissed analysts that questioned the production of Model 3 cars.

Contrition pays off - just ask Elon Musk.

"We want to make super fun games that integrate the center touch screen, phone & vehicle irl", he wrote.

Beyond operating costs, Tesla has paired down an initial $3.4 billion capital expenditure estimate for the year to a slimmer $2.7 billion.

Tesla burned through less cash than expected and beat analysts' revenue projections, but posted a second-quarter loss larger than Wall Street anticipated. That's substantially less than the 2017 level of $3.4 billion.

Tesla's website describes upcoming features - including the ability for a vehicle to change lanes without driver input, move from one freeway to another, and exit a freeway near the driver's destination - that are not available in Autopilot's current iteration.


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