Tesla today released its earnings results for the March quarter and posted revenue of $3.4 billion, easily besting Wall Street estimates which had revenue falling somewhere in the $3.1 billion range. Tesla’s record-setting revenue notwithstanding, the electric automaker, as anticipated, still lost money for the quarter. By the time the March quarter drew to a close, Tesla incurred a loss per share of $3.35.
As a point of reference, Tesla during the recent December quarter posted revenue of $3.29 billion and a loss of $675 million.
Of course, the main point of interest from Tesla’s earnings report centers on Model 3 production. To that end, Tesla notes that Model 3 production reached 2,270 units per week in April for a few weeks straight.
“We made significant progress on the Model 3 ramp in the second half of Q1, and the momentum continued into early Q2,” Tesla’s letter to investors reads. “Prior to a planned shutdown in mid-April to further increase production, we produced more than 2,000 Model 3 vehicles for three straight weeks, and we hit 2,270 in the last of those weeks. ”
Notably, Tesla claims that it may actually turn a profit during Q3 and Q4 of this year, though that obviously hinges upon the company’s ability to ramp up Model 3 production at a rapid clip.
“If we execute according to our plans, we will at least achieve positive net income excluding non-cash stock based compensation in Q3 and Q4 and we expect to also achieve full GAAP profitability in each of these quarters,” Tesla’s letter adds. “This is primarily based on our ability to reach Model 3 production volume of 5,000 units per week and to grow Model 3 gross margin from slightly negative in Q1 2018 to close to breakeven in Q2 and then to highly positive in Q3 and Q4.”
As it stands now, Tesla is still aiming to manufacture 5,000 Model 3 units per week by June of this year, with Musk noting a few weeks ago that Tesla is also hoping to manufacture 6,000 units per week by July. Beyond that, Tesla claims that it has its eyes on manufacturing 10,000 Model 3 vehicles per week, though it did not attach a timeline to this particular goal.
As a point of interest, Tesla added that cumulative Model 3 reservations have remained steady and currently stand at about 450,000.
With respect to Model S and Model X sales, Tesla notes:
Demand for our flagship Model S and Model X vehicles remains very strong. After all-time record orders in Q3 and Q4 2017, we had our highest ever Q1 for orders. With demand exceeding supply, we are making considerable progress with margin improvement. In Q1, we produced 24,728 Model S and X and 9,766 Model 3 vehicles, and delivered 21,815 Model S and Model X vehicles and 8,182 Model 3 vehicles, totaling 29,997 deliveries. Short-term operational and logistical issues led to an increase in the number of Model S and Model X vehicles in transit to customers at the end of Q1. Model 3 net reservations, including configured orders that had not yet been delivered, continued to exceed 450,000 at the end of Q1 even though fewer than 20 stores worldwide had Model 3 on display. We are planning to deploy significantly more Model 3 vehicles in our stores in Q2 this year.
Tesla’s full letter to shareholders can be viewed over here.