Tesla's CEO Elon Musk had to deliver more bad news today: the company lost more money than expected last quarter.
Tesla delivered more bad news on Wednesday, shortly after the bell sounded to end the day’s trading on Wall Street, announcing it lost $2.92 a share for the quarter. That was well below the $2.45 a share deficit that a consensus of industry analysts had forecast, according to Thomson Reuters.
One reason for the weak numbers was the trouble Tesla has been having with the launch of its Model 3, the company’s first mainstream battery-electric vehicle. While final sales weren’t released, industry sources said the figure was expected to be in the “low three digit” range, meaning the much-anticipated model was vastly outsold by General Motors’ own affordable, long-range battery-electric vehicle, the Chevrolet Bolt hitting a record of 2,781 sales in October.
The news wasn’t entirely bad for Tesla, however, the carmaker reporting revenues for the third quarter of $2.98 billion, a record, and up from the consensus forecast of $2.95 billion.
The sluggish rollout of the Model 3 hasn’t been due to a lack of demand. The company has more than 400,000 advanced reservations, but has been struggling to boost production after falling into what CEO Elon Musk has dubbed “production hell.”
(Tesla firings spark protests at company’s Fremont, California, plant. For the story, Click Here.)
“We continue to make progress resolving early bottlenecks related to these issues, and there remain no fundamental problems with our supply chain or any of our production processes,” Tesla said in a letter issued to shareholders on Wednesday afternoon.
How quickly it will be able to resolve those problem is far from uncertain, and a new report from automotive analysts at UBS warned this week that, “competing EVs are coming, and a long delay could reduce (Tesla’s) market share opportunity.”
Long the darling of Wall Street, Tesla shares have radically outperformed much of the market, and especially the domestic auto industry, this year. The automaker reached a 52-week peak – and a record high – of $389.61. But its numbers have been tumbling in recent weeks, reflecting concerns about the Model 3 launch and other issues. By the time trading ended on Wall Street on Wednesday, TSLA shares were down 3.15% to $321.08.
(To see why Tesla raised an additional $500M in cash, Click Here.)
Tesla has faced other issues lately, including the threat of action by the National Labor Relations Board which has been investigating its decision to discharge hundreds of workers at its Fremont, California assembly plant, ostensibly for “performance issues,” but critics contend the automaker used the Model 3 delays to get rid of workers who were attempting to organize the plant on behalf of the United Auto Workers Union.