Tesla warned that its adjusted gross margin would decline to about 15 percent due to a higher mix of lower-margin Model 3 deliveries in the fourth quarter, but then recover in the first quarter of 2018.
And the problems will continue.
Also buried: a massive loss of $671.1 million in the third quarter, bringing its loss through the first nine months of 2017 to $1.66 billion. Pittenger & Anderson Inc. raised its position in Tesla by 20.0% during the 2nd quarter.
Tesla reported a net loss of about $619.4 million, or $3.70 per share, compared to a net income of almost $21.9 million, or 14 cents a share, a year ago. Still, there's evidence that Tesla is very far from that goal: The Wall Street Journal reported last month that Model 3's were being "banged out by hand".More news: Over 2M Copies Of Super Mario Odyssey Sold In Just 3 Days
More news: White House on Mueller Investigation: 'Facts Are on Our Side'
More news: Palestinians killed in Israeli operation to destroy Gaza tunnel
The results compare to revenue of ~$2.8 billion and a loss of $2.04 per share (GAAP) during the previous quarter. This is a significant milestone as the Tesla fleet is now about 100 times larger than it was five years ago, just before the launch of Model S. In a report released yesterday, Nomura analyst Romit Shah maintained a Buy rating on TSLA, with a price target of $500, which implies an upside of 50% from current levels. The company opened 18 stores and service stations worldwide during the quarter, and set up 126 new Supercharger stations to try to prepare for the increase in demand from Model 3 buyers.
Including other cars - such as the Model S and Model X - Tesla's founder Elon Musk expects the company to produce 10,000 cars this year.
Tesla said in its third-quarter earnings letter that it's still hard to assess when it will sort out the "bottlenecks" that delayed Model 3 production in the third quarter.
Tesla Inc shares rose $0.54 (+0.16%) in premarket trading Wednesday. The shares have risen 45 percent since the start of this year.
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. Sustainable energy generation and storage is a critical part of Tesla's mission and will drive long-term revenue growth and profits.