Teslas second-quarter revenue increased 59percent year-on-year to $6.35 billion, with a net loss of $410 million.

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 Teslas second-quarter revenue increased 59percent year-on-year to $6.35 billion, with a net loss of $410 million.


Important operational data:

In the second quarter of 2019, 95,356 Tesla electric vehicles were delivered and 87,048 Tesla electric vehicles were produced, exceeding the quarterly record of about 91,000 deliveries and 86,600 production in the fourth quarter of 2018.

In the second quarter, delivery of Model 3 reached a record 77634.

As a result of this growth and operational improvement, Tesla generated $614 million in free cash flow (operating cash flow minus capital expenditure) in the second quarter. Cash and cash equivalents are $5 billion.

Despite the decline in average vehicle prices and reduced sales revenue, the gross profit margin for electric vehicles is still around 19%.

Shanghai Super Factory is expected to be put into production by the end of 2019, and ModelY will be launched in the autumn of 2020.

Teslas share price plunged nearly 11% in after-market trading after the results were released.

Tesla said its goal was to make profits in the third quarter, focusing on increasing sales, expanding capacity and generating more cash flow.

In order to increase profit margins and achieve profitability, Tesla has previously made layoffs and promised to close some stores to reduce costs. In recent months, the company has also adjusted its product pricing and abandoned some of its modified models.

Thanks to improvements in the logistics system, Tesla fulfilled CEO Elon Musks promise to deliver another record number of electric vehicles in the second quarter, reaching 95,200 vehicles.

Teslas second-quarter auto revenue was $5.38 billion, of which $112 million came from various regulatory credit revenues.

Tesla reiterated its full-year delivery target and expects to sell 360,000 to 400,000 vehicles this year, mostly Model 3 electric vehicles. In the first half of 2019, Tesla delivered about 158,200 cars to customers. It should be noted that the company must deliver more than 200,000 vehicles in the second half of this year in order to reach the low-end level of its delivery target. Tesla also said that the current weekly production of Model 3 electric vehicles is 7,000, and plans to produce 10,000 Model 3 electric vehicles a week by the end of 2019.

Tesla said in a letter to shareholders in the second quarter that it planned to expand capacity at existing plants, including battery plants in the suburbs of Renault, Nevada, and car assembly plants in Fremont, California, to boost sales of Model 3.

Tesla plans to start manufacturing Model 3 in China by the end of this year, which will reduce the cost of delivering products to Chinese customers and win credit incentives from Chinese regulators.

Tesla pointed out in her earnings report that the average price of Model 3 electric vehicles in North America in the second quarter was still $50,000, the same level as when the company released its first quarter results at the end of April.

Although sales of Teslas energy storage products Powerwall and Powerpack grew in the second quarter, sales of its solar power products fell. Tesla integrated the above products into a separate product line and said they earned $368.2 million in revenue from solar power and energy storage products in the second quarter, down 2% from the same period last year.

The company disclosed that Teslas household energy storage battery Powerwall has more than 50,000 installations to promote the use of renewable energy in households.

The company is trying to do more with less money, reducing its full-year capital expenditure projections to $1.5 billion to $2 billion. The company had previously estimated that capital expenditure would reach between $2 billion and $2.5 billion in 2019. The money will be used for the development of the companys major projects, including the completion of the construction of Shanghai Super Factory, the commissioning of Model Y electric SUV and Tesla Semi truck, and the expansion of Tesla charging station and service network.

For Tesla, after receiving nearly $3 billion in capital injections in May, the companys cash liquidity was stronger than ever. Its cash position rose to $5 billion, its net income from issuance of shares and convertible bonds in May was $2.4 billion and its free cash flow was $614 million. (Chen Chen)

Source: Responsible Editor of Netease Science and Technology Report: Wang Fengzhi_NT2541