Tesla (TSLA) announces Q3 2017 earnings: wider losses than expected on record revenue

After market close today, Tesla released its financial results and shareholders letter for the third quarter 2017. Wall Street was expecting record revenue of about $2.9 billion for the quarter and a loss of about $2.45 per share due to large capital expenditure caused by the slow start of Model 3 production.

The company released the official results today delivering on revenue of ~$2.9 billion and missed on earnings with a loss of $3.70 per share (GAAP).

Here we will be posting our follow-up posts about the earnings to expand on the most important points (refresh the page to see the most recent posts):

The shareholder letter has been embedded in full below.

Tesla’s stock price was down 4% in aftermarket trading following the release of the results.

The results compare to revenue of ~$2.8 billion and a loss of $2.04 per share (GAAP) during the previous quarter.

Tesla slightly updated its record delivery results for Model S and Model X:

“In Q3, we delivered 25,915 Model S and Model X vehicles and 222 Model 3 vehicles, for a total of 26,137 deliveries. Combined Model S and Model X deliveries in Q3 grew 18% globally compared to Q2 and 4.5% versus the same quarter one year ago. Consequently, both Model S and Model X gained further market share in the US luxury vehicle market. In addition, our used vehicle sales more than doubled from the prior quarter.”

The company’s gross margin took a big hit: 18.3% down from 27.9% quarter-over-quarter. It is attributed to Model 3 production being extremely costly right now with little deliveries.

Investors will be happy to know that Tesla is not planning another capital raise despite its wider losses:

“Between cash on hand, future cash flows and available lines of credit, we believe that we are well capitalized to accommodate the revised ramp of Model 3 production to 5,000 per week. Upon achieving this production level, we expect to generate significant cash flows from operating activities.”

Here’s the shareholder letter in full:

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