Slashdot Mirror
Tesla Posts 13th Straight Loss, Says On Track For Second-Half Deliveries (reuters.com)
An anonymous reader quotes a report from Reuters: Tesla Motors Inc reported its 13th straight quarterly loss as a rise in sales of its Model S and Model X electric cars failed to make up for the huge cost of ramping up production. The company, run by Silicon Valley entrepreneur Elon Musk, said on Wednesday it was on track to deliver about 50,000 new Model S and Model X vehicles during the second half of 2016. Shares of Tesla, which has offered to buy solar panel installer SolarCity Corp for $2.6 billion, were volatile in after-hours trading. They were last up 1 percent. Tesla delivered 14,402 vehicles in the second quarter, missing its goal of 17,000. It delivered 14,810 vehicles in the first quarter, which was also less than its expectations. Tesla said its net loss widened to $293.2 million, or $2.09 per share, in the second quarter, from $184.2 million, or $1.45 per share, a year earlier. Total revenue rose 33 percent to $1.27 billion in the quarter ended June 30. In addition to acquiring SolarCity, Tesla has unveiled its massive $5 billion Gigafactory in Nevada last week and announced its "Master Plan, Part Deux" not too long before that, which includes manufacturing electric trucks and buses, as well as a ride-sharing program.
They really need to take Charge of their profits. Things are looking very Negative for them. The Current situation is dire. These losses are simply reVolting. They need to Amp up production and eliminate all Resistance. It's coming down to the wire, time to think Positive.
If nobody wanted it, their sales last month wouldn't have been 267,258 units (GM) / 215,268 units (Ford) vs. just an estimated 3,300 units (Tesla). Those two brands also wouldn't own one-third of the entire market between them, versus 0.2% of the market for Tesla.
http://online.wsj.com/mdc/public/page/2_3022-autosales.html
The truth of the matter is that at the prices they're being sold for, most people want a Ford or GM far more than they want a Tesla.
And when Tesla announces a model at a price people do want, they do 325,000 pre-orders in a week. At $1000 per, that is $325M in deposits in a week.
http://www.theverge.com/2016/4/7/11385146/tesla-model-3-preorders-375000-elon-musk
So the truth is there is a demand for a low cost Tesla, now we wait and see if Elon and Co can deliver.
When asked how the company can survive by selling each unit at a loss, Elon Musk responded "Although Tesla sells each vehicle below the cost to manufacture, we will attain profitability by selling in volume".
Investors, at least the smart ones, are not primarily interested in profits.
They are interested in growth. A company that has zero growth potential and a stable profit paid in dividends can be far less attractive than a company posting losses with massive potential growth potential. Especially when capital gains taxes are a factor as they are in the US.
This is not always the case depending on your circumstances but most often is.
Remember the finance 101 law that states share price increases are always better than dividends because with share increases you can choose to sell some of your shares and get the same effect as dividends should you want it.
Also remember that, theoretically, share price is a combination of current company value with future growth potential and risk factored in. (hence why most stocks are valued far in excess of their book value) Risk is mitigated by investors across their portfolios (unless they are idiots) and in fact they would WANT them to take risks for the potential gains.
So yes, government and company books are nothing like personal accounts.
With government books it is wise to save during booms and spend like crazy during crashes to help smooth the economic cycle and prevent depressions. Completely counter intuitive to personal spending.