A number of companies have revealed quarterly earnings this week, including the likes of Vodacom and Facebook. Another company detailing its Q2 of 2019 is Tesla, with the electric vehicle (EV) maker noting both good and bad news for investors.
First the good, with Tesla confirming that it not only manufactured more EVs during the past quarter, but was also able to deliver them to more prospective car owners too. While that is indeed a significant development for the company as delivery and manufacturing delays have proved hurdles in the past, Tesla still suffered a loss for Q2.
This brings us to the bad news, with an estimated loss for the quarter of $408 million, as a recent SEC filing notes (PDF). As The Verge points out this latest loss is better than the $702 million deficit that Tesla posted in Q1, but the Model 3 is still not selling as well as the firm is aiming to to do.
Perhaps exacerbating matters is the fact that the firm’s CTO, JB Straubel, is stepping down from the role after being with the company for 15 years. “I’d like to thank JB for his fundamental role in creating and enabling Tesla,” said CEO Elon Musk last night, “If we hadn’t had lunch in 2003, Tesla wouldn’t wouldn’t exist, basically.”
As for how losing such a key figure within the company will affect operations is unclear, with his replacement not confirmed either.
Despite its loss Tesla did note that it generated $6.3 billion in revenue during the quarter, with a flattening of interest in the Model S and Model X being cited as contributors to the company’s below par profit, according to Musk.
He added during a call with investors this week that the company’s strategy would focus on the Model 3 and Model Y moving forward, while also offering up a possible explanation as to why the other two vehicle lineups are underperforming.
“There may be a false expectation in the market that there’s, like, some big overhaul coming for S and X which then, you know, could cause people to hesitate to buy if they think there’s like some radical redesign coming, which is why I emphasized publicly that this is not the case,” said Musk.
“The Model S and X today are radically better than the ones that when we first started production, especially the S. Like, a 2013 or 2012 Model S, compared to todays Model S — it’s night and day,” Musk added.
Whether that is indeed the case, Musk and co. will probably have to whether a few more quarterly losses before a profit begins being churned out. This as there is still a Gigafactory in China being completed, as well as the firm’s plans for self-driving long-haul trucks to bring to fruition.