Shares of SolarCity (NASDAQ:SCTY) have been all over the place since the company first hit the public market nearly five months ago. In fact, the stock dropped as much as 11% at the start of this month only to rebound with an 18% gain yesterday ahead of the company's earnings report. Meanwhile, shares of SolarCity are up more than 200% year to date, despite the fact that the company has not yet earned a profit.

Now that we have insight into the company's first-quarter-earnings results, let's shed some light on where SolarCity is headed from here.

Solar-powered earnings
SolarCity, which installs solar-powered units for homes and businesses, posted a first-quarter loss after the bell yesterday that disappointed analysts. The company reported a loss of $31 million for $0.41 per share in the period. Analysts on average were expecting a quarterly loss of $0.32 per share, according to Bloomberg.

However, it wasn't all bad news. SolarCity grew its customer base by as much as 106% over the year-ago period, as demand for the company's solar panels swelled. While revenue climbed 21% to $30 million, which was slightly above analysts' estimates, it was washed out by higher operating costs.

Higher costs rarely look good on paper, although for SolarCity these expenditures are investments that should pay off down the road. This is because SolarCity's business model is to help people finance the solar-powered rooftop panels. It also helps that unlike industry peers such as First Solar (NASDAQ:FSLR), SolarCity doesn't build its own solar panels.

First Solar is sensitive to cost pressures and efficiency standards because it manufactures the actual panels. SolarCity, on the other hand, simply installs and leases the technology to customers. This business model should create a lasting revenue stream for SolarCity.

Simply electrifying
It's also worth mentioning that Tesla Motors CEO Elon Musk is chairman of SolarCity. Moreover, Musk's 28% stake in SolarCity lends credibility to the renewable energy company. Musk's electric-car company continues to punish short-sellers for betting against the stock. To be sure, Tesla stock is up more than 100% in the last month alone.

And you can bet Musk will protect his investment in SolarCity as well. For this reason, investors shouldn't bench SolarCity just yet. While we wait for SolarCity to work out the kinks in the quarters ahead, it's worth taking a deeper look into shares of Tesla.

Motley Fool contributor Tamara Rutter owns shares of Tesla Motors. The Motley Fool recommends Tesla Motors. The Motley Fool owns shares of Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.