Tesla Publishes Blowout Financials Report — Shareholder Letter Full Of Gold

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Tesla has just published its Q3 shareholder letter, which is an absolute blowout. It is far better than even our supposedly “optimistic” forecast.

The bullet-point highlights are as follows:

  • GAAP net income of $312M, non-GAAP net income of $516M
  • Operating income of $417M and operating margin of 6.1%
  • Free cash flow of $881M supported by operating cash flow of $1.4B
  • $3.0B of cash and cash equivalents at Q3-end, increased by $731M in Q3
  • Model 3 GAAP and non-GAAP gross margin > 20% in Q3
  • Reaffirm expectation of continued GAAP net income and free cash flow in Q4

The intro paragraphs are as follows:

“Q3 2018 was a truly historic quarter for Tesla. Model 3 was the best-selling car in the US in terms of revenue and the 5th best-selling car in terms of volume. With average weekly Model 3 production through the quarter (excluding planned shutdowns) of roughly 4,300 units per week, we achieved GAAP net income of $312 million. We also delivered on our internal cost efficiency targets, leading to GAAP Model 3 gross margin of more than 20%, which exceeded our guidance. Finally, our total cash increased by $731 million and we had free cash flow (operating cash flow less capex) of $881 million despite less than 10% of that amount coming from key working capital items (payables, receivables, and inventory).

“Model 3 is attracting customers of both premium and non-premium brands, making it a truly mainstream product. We are thankful to our customers for being such strong advocates of our products and mission.”

Chart by Søren Jessing

There’s much more in the letter and we’ll have more thoughts and context coming in follow-up articles shortly.


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Zachary Shahan

Zach is tryin' to help society help itself one word at a time. He spends most of his time here on CleanTechnica as its director, chief editor, and CEO. Zach is recognized globally as an electric vehicle, solar energy, and energy storage expert. He has presented about cleantech at conferences in India, the UAE, Ukraine, Poland, Germany, the Netherlands, the USA, Canada, and Curaçao. Zach has long-term investments in Tesla [TSLA], NIO [NIO], Xpeng [XPEV], Ford [F], ChargePoint [CHPT], Amazon [AMZN], Piedmont Lithium [PLL], Lithium Americas [LAC], Albemarle Corporation [ALB], Nouveau Monde Graphite [NMGRF], Talon Metals [TLOFF], Arclight Clean Transition Corp [ACTC], and Starbucks [SBUX]. But he does not offer (explicitly or implicitly) investment advice of any sort.

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