US electric vehicle maker Tesla on Wednesday reported a loss of more than US$700 million for the first quarter of this year but vowed to return to profit later in the year.
Net loss attributable to common shareholders stood at $702.1 million in the three months to March, compared with a loss of US$709.6 million in the same period last year, Reuters reports.
Excluding some items, Tesla lost US$1.77 per share, compared with Wall Street expectations of a loss of 69 cents.
The company said loss in the second quarter would be “significantly” less than that recorded in the first, and that profit would return in the third quarter.
It said it plans to deliver 90,000 to 100,000 vehicles to customers in the second quarter, versus 63,000 vehicles in the first.
On a call following the results, CEO Elon Musk stepped back from an earlier prediction that the company’s Shanghai factory, which is currently being built, would likely produce 3,000 Model 3s per week by year’s end.
Instead, the so-called Gigafactory would build 1,000, or maybe 2,000 per week by the end of the year, he said.
Tesla, however, stood by its 2019 delivery forecast of 360,000 to 400,000 vehicles and said it may produce as many as 500,000 vehicles if its China factory reaches volume production in the fourth quarter.
Musk, meanwhile, suggested that a capital raise could be imminent.
“There is some merit to raising capital,” responded Musk, after being asked why he had not done so yet. “It’s probably about the right time.”
Musk is still battling to convince investors that demand for the Model 3, the sedan hoped to propel Tesla to sustainable profit, is “insanely” high, and that it can be delivered efficiently and swiftly to customers around the world.
Lower deliveries had added to worries over Tesla’s cash situation and increased speculation a capital raise was coming soon.
Many analysts had predicted the company would need to raise funds for its expansion, including the Shanghai factory, the upcoming Model Y SUV, and other projects.
Tesla said it ended its first quarter with US$2.2 billion in cash after paying off a US$920 million convertible bond obligation in March.
The gross profit margin on the Model 3 remained relatively steady at 20 percent.
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