Tesla reports a worse than expected loss $282.3m

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Tesla announced earnings http://www.ibtimes.com/tesla-motors-inc-...tes-its-2364209 Tesla Motors reported a much worse than expected loss of $282.3 million today. Another article from CNN Money: http://money.cnn.com/2016/05/04/news/companies/tesla-earnings/index.html?iid=hp-toplead-dom Quote: "Tesla CEO Elon Musk had said previously that the automaker would become "cash-flow positive" this year. But in a letter to shareholders Wednesday, Musk signaled that won't be the case after all." Apparently they forgot that they can't just take deposits, they actually need to produce the Model 3. On the other hand Model S sales are growing, up 45% compared to the same quarter last year.
 
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They would probably be cash flow positive if they made them more affordable and sold more vehicles! Those teslas are pretty slick though, I must admit. thumbsup I wonder if BMW is cash flow positive with their line of electric vehicles. confused If I could afford an all electric sportscar, I would much prefer an i8. I got a chance to see a couple back in Texas. They are suweeet. slobber http://www.bmwusa.com/bmw/bmwi/i8
 
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Tesla will not report any profit until most of current pre-order model 3 are shipped by 2018 or 2019. Tesla will invest huge amount(several billions ?) to increase production from 50,000 vehicles in 2015 to 80,000-90,000 this year to 500,000 in 2018. Investors didn't run away, Tesla stock went up 4.7 percent in the after hour trading, according to ibtimes.com.
 
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Perhaps they are ok taking a gamble of a decade of not being profitable because they believe the technology will pay off within the next decade. Reminds me of Richard Bransons space x venture. One of those billions or bust situations.
 
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Originally Posted By: jk_636
They would probably be cash flow positive if they made them more affordable and sold more vehicles. Man they are sweet though. I wonder if BMW is cash flow positive with their line of electric vehicles. confused If I could afford an all electric sportscar, I would much prefer an i8. I got a chance to see a couple back in Texas. They are suweeet. slobber http://www.bmwusa.com/bmw/bmwi/i8
To make more vehicles they need a lot more capital at the begining, but they didn't have enough capital so they go slow. BMW i8 is not an all electric sport car, it's a plug-in hybrid with 20 miles battery range.
 
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Originally Posted By: jk_636
Perhaps they are ok taking a gamble of a decade of not being profitable because they believe the technology will pay off within the next decade. Reminds me of Richard Bransons space x venture. One of those billions or bust situations.
If you look at one of the most successful company of the last 20 years that didn't report profit for more than 10-15 years, it was Amazon. If you look at the history of Amazon, you would see how much they expanded since they found 20+ years ago. A growth company with good plan can loosing money years after years but they still can get capital by issuing stock on open market to sustain their business.
 
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Im not sure if Amazon is the best example...not to get off topic but aren't they drowning at the moment? I thought I read somewhere that if things didn't change for them soon they would be deep underwater. confused
 
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Originally Posted By: jk_636
Im not sure if Amazon is the best example...not to get off topic but aren't they drowning at the moment? I thought I read somewhere that if things didn't change for them soon they would be deep underwater. confused
Amazon isn't the perfect comparison to Tesla, but there isn't any successful car companies of the last 50 years to compare Tesla with. I just try to express my opinion about a growth company. There was some failures such as Delorean, Fisker ... Clearly Tesla is in a much better shape than either one above, they sold all vehicles they can make, their problem is production not demand. The main question is can Tesla produce high volume car at reasonable cost to have small profit without much quality problems. Only Tesla knows the answer, we can speculate any way we like.
 
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The difference between Tesla and Amazon is that Amazon has never lost $282 million in a single quarter. When Amazon lost $274 million in 2012 (that's an entire year... not in a quarter), it was against total revenue of $13.8 billion. Tesla lost $282 million in Q1 on revenue of only $4 billion last year. Tesla has a weaker revenue stream than Amazon and higher losses. This is not really a realistic comparison.
 
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Originally Posted By: jk_636
Im not sure if Amazon is the best example...not to get off topic but aren't they drowning at the moment? I thought I read somewhere that if things didn't change for them soon they would be deep underwater. confused
The only thing making Amazon profit is the AWS part. Retail and online has been a negative since they were founded. And the AWS part is facing increased competition with Google breathing down their neck and stealing key contracts. Microsoft could be a contender if it wasn't based on their junk Windows technology. And the other smaller players like Backspace, etc. and it's lots of uncertainty.
 
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Tesla is a GAMBLE. The guy has even said that if he is running low on money for SpaceX, he just funnels a little off of Tesla, or if Tesla needs money, he just funnels some off of SpaceX. Seems to me this entire thing will crash and burn in spectacular fashion if he isn't still getting govt contracts for SpaceX, at least until Tesla can turn a profit. He needs to find a way to cheapen the product, as the current model of selling a car for $90k that it cost you $120K to build is not working.
 
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Originally Posted By: MrHorspwer
The difference between Tesla and Amazon is that Amazon has never lost $282 million in a single quarter. When Amazon lost $274 million in 2012 (that's an entire year... not in a quarter), it was against total revenue of $13.8 billion. Tesla lost $282 million in Q1 on revenue of only $4 billion last year. Tesla has a weaker revenue stream than Amazon and higher losses. This is not really a realistic comparison.
I am not comparing the 2 companies in details, I am just saying that a growth company like Tesla can have many quarters/years of lost and still in business. They still can get capital needed for expansion just like Amazon did for 20 years. When was the first full year of profit that Amazon reported ? Was it 2008-2009 ? What most people don't understand is to growth/expand a company you need a lot of money to buy equipments, making 50,000 vehicles in 2015 to 80,000 in 2015 and up to 500,000 in 2018 needs a lot of robots, stampings ...
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Nearly 20 Years In Business And It Still Doesn't Make Money, But Investors Don't Seem To Care So what's with Wall Street’s love affair with Amazon.com? The company barely ekes out a profit, spends a fortune on expansion and free shipping and is famously opaque about its business operations.
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Yet, investors continue to pour into the stock, pushing up the company’s share price to $388, a nearly 400 percent rise since the end of the company’s third quarter in September 2008. At that time, Amazon’s net profit margin was 2.8 percent. By September 2011, that number fell to 0.6 percent. A year later, it was losing $274 million on net sales of $13.8 billion. And in the latest quarter, ended Sept. 30, the massive e-tailer reported a $41 million loss on $17 billion in sales.
http://www.ibtimes.com/amazon-nearly-20-...em-care-1513368
 
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Originally Posted By: bubbatime
Tesla is a GAMBLE. The guy has even said that if he is running low on money for SpaceX, he just funnels a little off of Tesla, or if Tesla needs money, he just funnels some off of SpaceX. Seems to me this entire thing will crash and burn in spectacular fashion if he isn't still getting govt contracts for SpaceX, at least until Tesla can turn a profit. He needs to find a way to cheapen the product, as the current model of selling a car for $90k that it cost you $120K to build is not working.
Tesla's gross margin is positive(selling price is higher than what it costs to build)
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The Truth About Tesla's Gross Margin Tesla defines gross margin similarly to most other companies outside the automotive industry by including R&D in Operating Expenses (OpEx) rather than Cost of Goods Sold (COGS). Tesla's gross margin is higher than many of its competitors and is approaching the same level as Porsche.
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Logical Thought decided to move Tesla's R&D costs, which totaled $135.873 million in Q3 2014, to COGS to be comparable to Porsche. This brings Tesla's gross margin to 12.9%, compared to Porsche's 29.2%. However, the number Logical Thought moved up to COGS was $74.051 million (he wrote $75 million) because he amortized 52% (this is the same ratio as Porsche, which is arguably inapplicable to Tesla) of Tesla's R&D expenses over eight years and added them to the remaining 48%. However, it is worth noting that Tesla does not actually amortize R&D because almost all of its R&D is not model specific, which is why it reports R&D under OpEx rather than COGS. Therefore, one can conclude that this adjustment was done only for comparison purposes, and not because Tesla's incorrectly reports its gross margin.
http://seekingalpha.com/article/2790765-the-truth-about-teslas-gross-margin
 
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Musk is the typical money loser propped up by the government. Yet capitalists love it for some reason. It's socialism.
 
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Originally Posted By: KingCake
Musk is the typical money loser propped up by the government. Yet capitalists love it for some reason. It's socialism.
He's creating jobs. Thousands of them. What have you done besides pick boogers and sit on your moms couch? The capitalist? The CAPITALIST??!! Duh F? What are you a die in the wool commie?
 
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Originally Posted By: KingCake
Musk is the typical money loser propped up by the government. Yet capitalists love it for some reason. It's socialism.
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Palo Alto-based Tesla, which grew to 14,000 employees from just 899 at the end of 2010, plans to add 4,500 more workers in California alone during the next four years, according to terms of a $15 million tax credit awarded this year. Tesla currently has 1,600 open positions and is aggressively courting engineers for its autonomous car efforts, known as Autopilot.
http://www.wsj.com/articles/tesla-ramps-up-hiring-as-rivals-loom-1451350702 Money loser increases employees more than 15 times in 5 years, and plan to add more than 4,000 in California alone the next 4 years. We need more money loser like Musk, who employs high paying workers in US to produce vehicles to export to oversea, instead of outsourcing jobs to Mexico or China then import vehicles back into US.
 
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