• 18 hours Is This The Big Biotech Bust?
  • 1 day Funding Is The Biggest Hurdle For Clean Energy
  • 2 days Walmart Reaches Out To Chilean Government For Protection
  • 2 days The Most Exciting Gold Find Of The Decade
  • 2 days Mining Boom Sparks Deforestation Concerns
  • 3 days The Cannabis Culling Has Wall Street Disappointed
  • 3 days Vigilante Offers $100,000 Bounty To Hack Banks
  • 4 days The Dairy Industry Is Dying
  • 4 days The Most Impressive Electric Vehicle Of The Year
  • 5 days Gold Miners Are Having A Stellar Second Half
  • 6 days How 3D Printing Is Turning Each And Every Industry On Its Head
  • 6 days Is The $3.5 Trillion Healthcare Industry About To Get Much More Transparent?
  • 7 days Gamblers Are Betting Big On Trump’s Impeachment
  • 7 days Even Banks Can't Answer Aramco's Trillion Dollar Question
  • 8 days Will Bezos Buy The Seattle Seahawks?
  • 8 days 6 Tech Trends Transforming The Travel Industry
  • 9 days Ousted Uber CEO Cashes Out $500 Million In Stock
  • 9 days Trump Prepares For Another Key Tariff Decision
  • 9 days The Free Money Bubble Is About To Burst
  • 10 days The Crushing Reality Of Poverty In America
  1. Home
  2. Investing
  3. Stocks

Tesla Posts Surprising $700 Million Loss In Q1 Earnings Report

Tesla

Tesla may soon announce a capital raise after Elon Musk suggested “There is some merit to raising capital,” adding “It’s probably about the right time,” as quoted by Reuters. The comments by Tesla’s CEO followed the release of the company’s first-quarter results yesterday.

The EV maker reported a net loss of US$702 million as well as a US$1.5-billion decline in cash and cash equivalents, to US$2.2 billion. What’s more, Model 3 production only inched up by 3 percent during the quarter, to 63,000, which must have disappointed shareholders eager to see the strong growth in production promised by the company.

Going forward, Musk once again revised down production targets: the gigafactory in Shanghai, currently in construction, would produce an average 1,000 or maybe 2,000 Model 3s weekly this year, rather than the 3,000 expected earlier.

Overall, however, Tesla kept its production forecasts for the year unchanged at 360,000 to 400,000. A production rate of 500,000 cars is also a possibility in case the Chinese factory achieves volume production in the last quarter of the year. Related: Investors Are Piling Into Tax-Exempt Municipal Bonds

As for the next financial results of the company, this quarter’s loss will be a lot lower than the one for the first quarter, and in the third quarter the carmaker will return to the black. The need for a capital raise, however, may worry investors, whose lives have been kept interesting by Musk and company without a doubt.

The latest reason to worry came earlier this month, when one of the company’s largest shareholders, T. Rowe Price, cut its the stake he holds in Tesla via several funds sparking concern in the market. Between September and December last year, the funds reduced their holding in the EV maker from 10.2 percent to 5.2 percent. The cutting continued in 2019 as well: according to Reuters Refinitiv data, the asset manager divested 92 percent of its previous interest in Tesla.

By Irina Slav for Safehaven.com

More Top Reads From Safehaven.com

Back to homepage

Leave a comment

Leave a comment