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Tesla Shares Up 4% on Robust Q2 Revenues, Outlook

Shares of electric vehicle (EV) leader Tesla Inc. TSLA is rising in late trading today after posting its Q2 earnings results after the bell today. A bottom-line loss of $2.04 per share (accounting for stock-based compensation and other potential BNRI) actually missed the -$2.00 per share in the Zacks consensus estimate. (Its headline number of $1.33 beat The Street's estimate of $1.88.) Sales revenue of $2.79 billion blew past the $2.55 billion expected, which itself represented a 63% increase year over year.

The main focus in the company's letter to investors was on the ramp-up of the coming Model 3, deliveries of which will begin (to non-employees) in Q4. Tesla averages 1800 new reservations PER DAY for the Model 3, which is impressive for a company that has produced 25,708 vehicles in Q2 2017 (up 40% year over year). The company expects positive gross margins from the Model 3 beginning in Q4 2017. Gross margins for the just-concluded quarter reached 27.9% overall, better than analysts had expected.

Of course, it's whether Tesla is physically able to deliver on these reservations in a timely manner that has been the company's biggest bugaboo -- and when that's the worst problem your firm faces, no wonder you're up 50% year to date and another 4% in the after-market. An already announced shortage of 100 kWh batteries back in June held up production a bit, but nowhere near what the company was faced with in the early days of its public existence.

The company also announced it now has $3 billion in cash (partly supported by cash from energy from its solar power systems improving), meaning the company will likely not need to raise additional cash in 2017. By then, one may suppose, Model 3 sales will be off to the races, as they say, and auto revenues, which grew 93% since this time a year ago, may be in another dimension.

For more on Tesla's earnings, click here.

Jack Dorsey's "Other" Company Reports

Payments processing firm Square, Inc. SQ spiked up 5% in post-market trading (before slipping a bit since) following its meet on bottom line on higher quarterly revenues. The San Francisco-based firm reported a loss of 4 cents per share, a gain of 50% year over year, on $552 million in sales, easily outpacing the $537 million expected. Square also upped guidance for the full year, looking for both higher revenues and lower losses on the bottom line.

For more on Square Inc.'s earnings, click here.


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