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Tesla Motors Inc. Crushes Q1 Estimates, Announces Soft Q2 Guidance; Shares Fall 7%

The Tesla Model X is under heavy development right now. Image source: Tesla Motors.

Tesla Motors (NASDAQ: TSLA  ) just reported results for the first quarter of 2014. The electric-vehicle builder beat analyst targets on both the top and bottom lines but followed up with mixed next-quarter guidance. Responding to the news, shares fell more than 7% in after-hours trading.

In the first quarter, Tesla produced 7,535 Model S vehicles and shipped 6,457 units to its customers. 1,181 of these deliveries were sold with a resale value guarantee.

These shipments generated $713 million in non-GAAP revenue, which is a revenue metric that adds back the long-term value of financing contracts signed with an RVG. Further down the income statement, Tesla reported $0.12 of adjusted earnings per share.

Analysts were looking for earnings of $0.10 per share on $699 million in sales. Tesla beat both targets by a fair margin.

Looking ahead, Tesla sketched out second-quarter revenue of roughly $827 million, but the quarter will only be "marginally profitable" in non-GAAP terms. Analysts were looking for slightly lower next-quarter sales but also projected robust year-over-year earnings growth.

Tesla explained that battery cell supplies remain a bottleneck in the manufacturing process, and that production will exceed shipments in the second quarter because of long delivery times for build-to-order cars in Europe and Asia.

"We are expanding our factory capacity to support increased Model S production later this year and the introduction of Model X next year," said Tesla CEO Elon Musk and CFO Deepak Ahuja in a prepared statement. "Extensive development work on Model X is under way, and we expect to have production design prototypes ready in Q4."

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Comments from our Foolish Readers

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  • Report this Comment On May 08, 2014, at 12:00 PM, RedScourge wrote:

    "Tesla reported $0.12 of adjusted earnings per share.

    Analysts were looking for earnings of $0.10 per share on $699 million in sales. Tesla beat both targets by a fair margin."

    It's hardly "crushing" estimates to beat them by 2 cents per share on a $200 per share stock, but whatever you say.

  • Report this Comment On May 08, 2014, at 2:08 PM, investingNideas wrote:

    "battery cell supplies remain a bottleneck in the manufacturing process"

    They could go with less batteries and more hydrogen cells.

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Anders Bylund

Anders Bylund is a Foolish Technology and Entertainment Specialist. Where the two markets intersect, you'll find his wheelhouse. He has been an official Fool since 2006 but a jester all his life.

Hypoallergenic. Contains six flavors not found in nature. Believes in coyotes and time as an abstract.

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7/30/2015 2:05 PM
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