Higher R&D Costs Drive EV Maker Tesla Motors to Post Larger Second-Quarter Loss
By Scott Doggett August 5, 2010
Tesla Motors, maker of the lightning-quick all-electric Roadster (pictured), posted a larger year-over-year second-quarter loss on higher research and development costs as the EV maker races to launch a new model in 2012.
Tesla on Wednesday reported a Q2 net loss of $38.5 million, or $5.04 per share, compared to a loss of $10.8 million, or $1.56 per share, a year ago.
The Silicon Valley automaker's shares closed down more than 3 percent to $21.26 on the Nasdaq during regular trading and an additional 5 percent to $20.50 in after-hours trading.
That said, revenue was $28.4 million, up 5.4 percent from a year ago. Tesla had 7.64 million common shares outstanding in the second quarter, compared with 6.96 million last year.
Tesla, which initially offered stock to the public in late June, does not expect to be profitable until it sells significant numbers of a planned Model S sedan that it expects to begin selling in 2012.
According to analysts at IHS Automotive, this is going to be the most difficult part of the Tesla IPO going forward: the quarterly reports for at least the next two years that show Tesla as not earning any money, and posting quarter after quarter of losses.
The Roadster model has been on sale for two years already, and only about 1,200 of the $109,000 (base price) vehicles have been sold. It will not be providing any massive revenue or profit influx, the analysts noted.
The company's next model, a $57,000 sedan, is still at least two years away, with the company claiming that everything is on track with its internal battery and powertrain development.
"This gives the Tesla plans an air of 'vaporware,' to steal a Silicon Valley term, despite the company's protestations to the contrary," an IHS analyst said. "The item that really may have saved Tesla however is its new partnership and investment from Toyota."
The two automakers have announced that a Tesla-developed RAV4 EV will be coming in 2012 as well.
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