Tesla shares reverse as electric carmaker’s second quarter numbers miss forecasts, full-year outlook softer than expected

Tesla Inc (NASDAQ:TSLA) shares reversed on Thursday after the electric carmaker’s second quarter numbers, released after-hours on Wednesday, missed forecasts and the firm gave a softer than expected outlook for full-year 2019.

The Nasdaq-listed firm said it stills aim to be profitable in the third and fourth quarter but put the emphasis on volume growth, increasing production capacity and generating cash.

That contrasted with Tesla boss Elon Musk’s promises this time last year that the company would be profitable and cash flow positive “henceforth”.

For the second quarter, Tesla posted an adjusted loss per share of $1.12, well above forecasts for a $0.40 loss, while revenue was $6.35 billion versus the $6.41 billion expected.

During the same period last year, Tesla reported an adjusted loss of $3.06 per share on revenue of $4 billion.

The company reaffirmed its full-year delivery guidance, saying it still expects to sell 360,000 to 400,000 vehicles this year, mostly Model 3s.

Tesla delivered around 158,200 of its cars to customers in the first six months of 2019. It has to deliver more than 200,000 in the second half of the year to hit the low-end of its guidance.

The company said it has a weekly run-rate of 7,000 Model 3 vehicles, and aims to be able to produce 10,000 Model 3s weekly by the end of 2019.

Tesla is aiming for the start of production of the Model 3 in China by the end of the year, which will allow it to benefit from lower costs to deliver to customers there.

In morning trading on Thursday, Tesla shares were down 14% to $227.26.

Wedbush Securities cut its price target on the stock to $220 from $230, citing a softer margin profile.

Story by ProactiveInvestors