Tesla losses grow in Q2 as it fails to reach sales goals

Tesla instead delivered 14,402 vehicles, as it showed progress toward the company’s goals.

“There’s no doubt Tesla will remain the category leader as electric vehicles become increasingly mainstream, but it could be years before the bottom line justifies any investment in Tesla other than a purely speculative one”, said James Brumley, InvestorPlace.com analyst. On Wednesday, Aug. 3, 2016, Tesla reports financial results. The executive previously admitted that internal ‘hubris’ and supplier issues had delayed the Model X and inhibited production volume ramp-up.

Tesla finished the second quarter of 2016 with $1.56 billion Dollars in sales and with an adjusted loss of $1.06 USD per share. They projected the company would bring in $1.6 billion in revenue during the period. As part of this plan the American electric vehicle manufacturer will be bringing in the Model Y. This compact SUV will be based on the same chassis as the Model 3 luxury sedan that the company revealed in April.

Teslas shares rose less than 1 percent to $227.50 in after-hours trading. Tesla earlier in the year said it expected to deliver between 80,000-90,000 vehicles in total for 2016. For the second half of the year, management reiterated its target for 50,000 deliveries. It aims to further increase the production and reach 2,400 vehicles per week in the fourth quarter.

Its been a turbulent quarter for Palo Alto, California-based Tesla.

Moreover, there is a huge interest surrounding the upcoming Model 3 of Tesla. Tesla began taking reservations March 31 and within a week it had more than 325,000 reservations for the $35,000 auto, which is due out next year. The company is now working on their new sedan, Model 3, which is due to be launched next year.

Likewise, Musk reiterated that Tesla expects its auto output will leap to 500,000 vehicles in 2018, when production of the upcoming Model 3, priced at $35,000, is expected to be in full swing. Just as importantly, Tesla said it remains committed to producing 500,000 vehicles in 2018.

But things took a downward turn later in the quarter. US safety regulators are investigating a fatal Florida crash in May that involved Tesla’s Autopilot driver-assistance features. That investigation is ongoing, but Musk insists the system is safe if it’s used correctly. Mr. Musk said that customers to love the “next-generation technology” and he expects “exponential growth” from 4QFY16.

Tesla Motors needs more money for covering the disclose in $1.1 bln in the third-quarter 2016.

Musk also proposed combining solar panel company SolarCity, a firm that he also chairs, with Tesla to double down on renewable energy generation.

The merger must still be approved by government regulators and shareholders at both companies. For the Model 3 program, which Tesla expects to generate $20 billion annually, Tesla has moved on to tooling, production planning, and validation. However, non-GAAP revenues climbed 30.6% year over year to $1.6 billion and came in above the Zacks Consensus Estimate of $1.5 billion.