Tesla (TSLA) is set to release its fourth quarter 2016 and full year 2016 financial results on Wednesday, February 22 after market close. As usual, the release of the results will be followed by a conference call and Q&A with Tesla’s management at 2:30pm Pacific Time (5:30pm Eastern Time).
Now here’s what to expect on Wednesday:
It should be a pretty exciting earning considering Tesla confirmed that it paused production of the Model S and X at the plant this week in order to update manufacturing equipment for the Model 3 and industry watchers will be waiting for an update on that due to the perfect timing with the earnings.
What is also interesting is that last quarter Tesla announced its first GAAP profit in over 3 years and CEO Elon Musk said that Tesla could carry being cash flow positive from operations in the fourth quarter.
Deliveries
The company already disclosed its delivery number for the last quarter and the full year: 22,200 delivered and 24,882 produced in Q4; full-year deliveries 76,230, slightly below expectations of 80,000.
Considering they missed their delivery target and total deliveries decreased quarter-over-quarter, it could be hard to hit the earnings targets, but let see what people are expecting.
Revenue
Wall Street’s revenue consensus is $2.201 billion for the quarter, while Estimize, the financial estimate crowdsourcing website, predicts $2.243 billion in revenue.
That’s down from Tesla’s actual revenue of $2.298 billion during the last quarter and up from $1.747 billion in revenue in Q4 2015.
The predictions for Tesla’s revenue over the past 2 years – Estimize predictions in blue – Wall Street consensus in grey – Actual results in green:
As you can see, Tesla beat both Wall Street and Estimize consensus for revenue over the last two quarters.
This quarter’s revenue estimates are just slightly below last quarter’s result, which makes sense since Tesla’s vehicle deliveries are down by a couple thousand vehicles, but they also deployed several important new Powerpack projects and some of SolarCity revenue should be accounted for though it’s not clear how that will be accounted at this point.
Earnings
Earnings per share, or rather loss per share, is expected to thread really close to 0 for the quarter and an overall loss for the full year.
The Wall Street consensus is a loss of $0.13 per share for the quarter, while Estimize’s prediction is a slight loss of $0.05 per share.
Earnings per share over the last 2 years – Estimize predictions in blue – Wall Street consensus in grey – Actual results in green:
Of course, last quarter’s estimates were quite wrong since Tesla surprised everyone with a gain and while a surprise is not out of the question this quarter again, it would be even more surprising than in Q3 because of the delivery miss.
Other expectations for the shareholders letter and analyst call
Again, the biggest thing shareholders and analysts will be looking for is an update on Model 3 – more specifically, a guidance for overall deliveries in 2017, including Model 3 deliveries.
If Tesla is still on track to start deliveries this summer, people will want to know how quickly they can be expected to ramp up to volume production. Company officials have so far been very vague on the subject. The best estimate was released by Musk as a guess of 100,000 to 200,000 units, which most industry analysts don’t believe to be possible.
The other important thing shareholders and analysts will be looking for is how Tesla will report ‘Tesla Energy’ and ‘SolarCity’ financials in its results. Of course, they will also want an update on how the integration of SolarCity into Tesla has been going since the merger was approved just over 2 months ago.
Join us on Electrek on Wednesday after market close for our report on the results and shareholders letter. You can stick around after for the conference call with management at 2:30pm Pacific Time (5:30pm Eastern Time) and you can join on the call through Tesla’s investor relations website.
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