Tesla Inc Chief Executive Elon Musk suggested on Wednesday a capital raise could...
- Tesla Inc Chief Executive Elon Musk suggested on Wednesday a capital raise could be imminent, as the electric vehicle maker lost $700 million in the first quarter and predicted a return to profit in the third.
Shares of Tesla, which are down 22 percent this year, were about flat after the results, which came more than an hour after they were expected. Many analysts had predicted the company would need to raise funds for its expansion, including the Shanghai factory, the upcoming Model Y SUV, and other projects. Tesla said it ended its first quarter with $2.2 billion in cash after paying off a $920 million convertible bond obligation in March.
Tesla said a loss in its second quarter would be “significantly” less than the $702 million lost in the first quarter. Profit would return in the third quarter, Tesla said. Heightening uncertainty during the quarter were logistics bottlenecks at international ports, price adjustments on vehicles and a surprise announcement, later reversed, to close most of Tesla’s stores in order to financially offset the introduction of the $35,000 Model 3.
The gross profit margin on the Model 3 - a focus for investors - remained relatively steady at 20 percent.
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