Electric-car maker Tesla Inc on Wednesday reported a "historic" quarterly profit driven by demand for its mass market Model 3 as the company looks beyond its United States home base to Europe and China.
Tesla investors are cheering the company's best-ever quarter with the shares of the company climbing in early trading, but Wall Street isn't yet ready to drop its cautious stance.
Musk's settlement with the Securities and Exchange Commission was approved by U.S. District Judge Alison Nathan in Manhattan on October 16, the U.S. Department of Justice may still be ongoing, according to the WSJ.
Action in the criminal investigation, headed by the United States attorney's office in San Francisco, intensified in recent weeks after the Securities and Exchange Commission settled separate civil charges with Tesla and Chief Executive Officer Elon Musk.
This story is developing and will be updated. "So that you'll be able to do ride-hailing or share your vehicle anyway, sort of a long-term model that's some combination of like Uber, Lyft and Airbnb".
In brief: Tesla and CEO Elon Musk recently settled a dispute with the DOJ but according to a recent report from The Wall Street Journal, the company's legal woes may only be deepening. Shortening the time cars are in transit so that revenue can hit the books more quickly would shorten its cash conversion cycle, boosting cash flow.
Despite Tesla's claims to the contrary, Morgan Stanley continues to expect a $2.5-billion raise in the fourth quarter, and UBS concurs that additional cash is required to expand Fremont production, ramp the Model Y and construct the Shanghai factory.
We believe this is mostly working capital driven; and with the company's growth targets, capital requirements, an expected slow improvement in gross margin trajectory, and our views on sustainability of demand (particularly when incentives dissipate) we still see downside risk to longer-term FactSet consensus estimates. In early 2017, the Palo Alto, California-based company announced plans to produce up to 5,000 Model 3s a week by the end of that year. In order to improve upon costs, Tesla offered customers a mid-size range version of the Model 3 which started at United States dollars 46,000. The aim is to shift up to a million cars a year outside the US.
Tesla actually bumped its reporting date by almost two weeks, Forbes reports, while many observers believed it meant the company had good news, or that it didn't want to be buried under the coverage of USA midterm elections.
Despite not revealing the final prototype to the public, Musk approved production of the elusive Model Y crossover in a conference call discussing the company's third quarter financial results, according to Electrek. Tesla is in no danger of going bankrupt.
Talking about Tesla's future plans - which include the Model Y, a new Roadster, a lorry and a pick-up - Musk said the firm has "the most exciting product roadmap of any company on Earth".
The comments were made when Musk was sharing updates on Tesla's third-quarter earnings, which showed a surprising profit. On average, Tesla produced about 4,300 Model 3 vehicles per week, delivering a total of 56,065 in the quarter.
Analysts thought Tesla was in trouble earlier this year because the company had been burning nearly a billion dollars a quarter in late 2017 and early 2018.
Such credit sales pushed Tesla to a profit in its third-quarter of 2016, one of two times it has been in the black so far.