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An Investor’s Guide to Tesla Motors’s Key Financials

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Tesla Motors’s key financials

Previously, we analyzed Tesla Motors’s (TSLA) business operations. However, if you are an investor in Tesla, you might also want to explore the company’s financial performance, which is discussed in the coming parts of this series.

Let’s begin by looking at how Tesla’s shipments and revenues have shaped up over the last couple of years.

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Tesla Motors’s revenues

Tesla Motors’s revenues have grown at a steady pace, as can be seen in the chart above. However, such tremendous revenue growth is quite normal for a company in its start-up phase.

Tesla’s revenues grew more than 15 times between FY 2011 and FY 2014. Analysts expect Tesla’s revenues to grow at a CAGR (compounded annual growth rate) of more than 60% over the next few years. This is not surprising, given Tesla’s strong order book.

Tesla sold 28,713 cars worldwide (ACWI) (VEU) in 2014. This year, the company expects to sell between 50,000 and 55,000 cars.

Operating leases

Tesla has started selling its cars on leases, as well. This is a standard industry practice in the automobile industry, and all companies including Ford (F) and General Motors (GM) sell a large percentage of their vehicles on leases.

Please note that selling cars on lease also leads to less revenue in the short term. A car’s revenue is recognized as “lease revenue” through the lease tenure.

Shipments and revenues have never been a challenge for Tesla, but several analysts have questioned Tesla’s ability to generate profits. We’ll discuss Tesla’s profitability in more depth in the next part of this series.

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