Tesla posts new record quarterly loss - US$784.6mil

Tesla posts new record quarterly loss - US$784.6mil

"It's high time we became profitable", he said during today's teleconference for analysts. "That's our focus right now".

Not everything Elon Musk touches turns to gold, apparently, as his electric vehicle company Tesla burned through $710m in cash in the second quarter despite impressive revenues of $3.2bn.

The lack of Model 3 revenue has aggravated Tesla's cash burn as the Silicon Valley company continues to spend on its assembly line and prepares for new investments on multiple projects. Meanwhile, the electric vehicle maker lost $3.35 per share.

The key questions have to do with the Model 3, which Musk is counting on to bring the company to profitability by the latter half of this year.

Tesla's balance sheet was also a sore subject.

In answering questions from Gali Russell, Musk also revealed that Model Y production is not expected to begin for another two years, and that the vehicle won't be produced at Tesla's main, Fremont, Calif. factory. The company expects production numbers to stay around the same level for Q2 2018 but said it aims to ramp up production in Q3 2018 to meet its avowed target of 100,000 deliveries by the end of 2018. Interestingly, Model 3 is the first auto from Tesla to be launched in the Indian market.

The Model 3 starts at $35,000 but can easily top $50,000 with options. "We're gonna go to YouTube".

Musk realised Tesla's mistakes and said: "We made the mistake of adding too much automation too quickly".

More news: BP logs soaring first-quarter profits

Despite growing losses, the company's bosses are confident it'll post positive net income (excluding non-cash stock based compensation) by the end of this year.

If any company can be described as a victim of its own success, it's Tesla.

The Moody's ratings agency early last month downgraded the company's credit further into junk status, saying Tesla might run out of cash if it did not raise more than $2 billion. Revenue exceeded estimates of $3.28 billion. The business was $710 million (£523 million) in the red in the first quarter and burned its way through $700 million in cash.

An initial rally after Tesla released a letter from its CEO did not last, and the shares dropped during a unusual and tense conference call.

And so Tesla is in a race against time to break-even. The first batch of the sedans - with 30 vehicles - was delivered in July 2017, and Tesla was able to make a total of 1,764 deliveries in 2017.

At first, the news didn't appear to hit investor confidence, as Tesla's stock increased by 1% in the hour following Tesla's announcement.

"They hope to be in positive cash flow and earnings territory in the third and fourth quarters", said Clement Thibault, senior analyst with Investing.com.

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