California-based electric-car maker Tesla Motors said it lost $38 million in the third quarter, or 32 cents a share, according to GAAP, on revenue of $431 million.
That was worse than the 25-cent loss that analysts using GAAP had forecast.
Stock price tumbled more than $20, or 11.5%, to $155 in the first three hours of after-hour trading following the close of the Nasdaq exchange.
Tesla prefers to report results using non-GAAP methods — also known as adjusted results — under which it earned an adjusted $16 million in the quarter, or 12 cents a share, beating the non-GAAP forecast of 11 cents. Adjusted revenue was $603 million.
Acknowledging the adjusted results, but saying they weren’t good enough, auto-industry analyst Brian Johnson at Barclays told clients in a note Tuesday afternoon: “Results with somewhat slower ramp of Tesla S deliveries reinforce our view that Tesla had overshot in the past few months and is more properly valued at $141.”
CEO and founder Elon Musk earlier forecast 5,000 Model S deliveries in Q3. The company reported 5,500. Johnson had forecast 5,850.
Tesla on Tuesday predicted 6,000 Model S deliveries in the fourth quarter. Johnson wanted to see 6,603.
In a conference call with Wall Street analysts after the earnings announcement, Musk said, “There is a huge amount of demand in North America” for the company’s electric-power luxury cars. But U.S. sales might disappoint because the maker is capacity-constrained, “and we have to start delivering cars to Europe.”
He noted that Tesla signed a new agreement with Panasonic for more cells that make up the power-pack of the Model S sedan as well as the Model X crossover SUV coming late next year and a third vehicle, priced about $35,000, after that.
The stock closed regular trading Tuesday at $176.81, up $1.61 or 0.9%.
Share price had been zipping upward since Oct. 30, after a 17% drop during that month. The recent climb came despite comments by Musk recently that the stock was overpriced.
An estimate by Nasdaq, where Tesla shares are traded, said that the stock was trading at a breathtaking 711 times earnings before the after-hours plunge Tuesday.
“Tesla’s appeal is based as much on image and reputation as hard financial numbers. The company will likely remain on track, even after this quarter, as the financial darling of the car world,” said Karl Brauer, a senior analyst for auto researcher Kelley Blue Book.
Selling Tuesday could have been investors locking in profits, rather than losing faith in the company. Regarded more like a volatile tech stock than a car-company stock, Tesla’s share-price ride has been a wild one. Its 52-week high is $194.50 and the 52-week low is $29.33.
This year, it’s up more than 400%.
Musk has said a crossover SUV to be called Model X coming soon will be priced not much more than the Model S hatchback sedan, which starts at about $73,000.
In his quarterly letter to shareholders, Musk forecast fourth-quarter adjusted earningsabout even with third-quarter results.
But he said Q4 free cash flow would be “about break-even,” which is a drop from the Q3 $26 million, a record for the company.
Musk said the company’s cash on hand at the end of the quarter was $796 million, up $49 million from the previous quarter.
Courtesy of USA Today