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article imageTesla misses big on first-quarter earnings with $702 million loss

By Karen Graham     Apr 24, 2019 in Business
Tesla has fallen back into the red in the first quarter after last year’s profitable second half, the result of weaker deliveries of its namesake electric vehicles, reporting a much bigger loss than analysts expected.
Tesla lost $702 million in the quarter or $4.10 per share, on a GAAP basis. On an adjusted basis, this comes to $2.90 versus the 69 cents per share expected. Revenues were expected to hit $5.19 billion but came in at $4.54 billion, reports CNBC.
The bigger than expected loss on shares as well as revenue can be attributed to waning sales of the electric car company's Model 3, especially now that the federal tax credit has disappeared. The company also took a hit after paying off a $920 million convertible bond obligation in cash in March.
“This was one of the most complicated quarters I can think of in the history of the company,” Zachary Kirkhorn, Tesla’s new CFO, said on a conference call with analysts, according to Forbes.
Tesla Factory  Fremont  California
Tesla Factory, Fremont, California
Maurizio Pesce (CC BY 2.0)
One of those complications included the start of shipments of the Model 3 to China, something that proved to be a lot more time-consuming than expected. This goes back to what CEO Elon Mush said in early April when he pointed out that one of the big challenges is trying to deliver cars around the world when they are all being made at one factory in the San Francisco Bay Area
Another drain on Tesla's cash reserves this month is a $180 million debt coming due. However, Musk again reiterated the delivery problems due to unforeseen challenges in the earnings call Wednesday, noting that deliveries are being moved to the second quarter. This situation was also predicted by CNBC earlier this month.
The ever-optimistic Musk is still working at getting the new battery factory and car assembly plant in Shanghai up and running, and just two days ago, he hosted an “Autonomy Day” conference and wowed attendees and tens of thousands of livestream viewers with his plans for putting a million self-driving Teslas on the road by next year as part of a ride-service plan operated by his company, according to Tech Crunch.
Tesla CEO Elon Musk says the firm is "moving rapidly" to get production going in China
Tesla CEO Elon Musk says the firm is "moving rapidly" to get production going in China
Brendan Smialowski, AFP/File
The silent leaf-blower
In related news, Elon Musk tweeted on Tuesday Tesla was going to develop a quiet leaf blower. The tweet got 265, 000 likes from devoted Elon Musk fans, this writer included. But the tweet also caught the attention of the world's biggest porn site.
Pornhub, according to Market Watch possible saw money to be made and tweeted: "Want to collaborate on a dual-purpose blower?" Musk replied: "Like blowing twigs, too?"
But seriously, several Twitter followers wanted to know if the leaf blower would really be quiet and less polluting than a two-stroke engine. But with all that Musk has going on right now, who knows when we’ll get that quiet, electric leaf blower from Elon Musk and Tesla, but when it does come out, it will be as successful as the flamethrower.
Musk's Boring Company has used some unorthodox methods to raise money, and one of the very first was the Boring Flamethrower. The company raised $7.5 million selling $500 flamethrowers bearing the company logo.
Elon Musk at the Boring Company information session on Thursday night.
Elon Musk at the Boring Company information session on Thursday night.
Boring Company
More about Tesla, firstquarter earnings, delivery volumes, federal tax credit, Model 3
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