Inside Analyst Estimates for Tesla’s Revenue Growth



Tesla’s revenue

So far in this series, we’ve covered analyst expectations and recommendations for Tesla Motors (TSLA). Wall Street analysts are divided. But in the past several quarters, despite all the hurdles, Tesla has demonstrated series potential, which is reflected in its high revenue growth rate.

Inside Analyst Estimates for Tesla's Revenue Growth

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Revenue estimates

Analysts are estimating that Tesla’s non-GAAP (generally accepted accounting principles) revenue will be $1.6 billion in 1Q16. This would be 46.5% higher YoY (year-over-year) than the $1.1 billion in revenue in 1Q15. These higher revenues could be seen as a result of more momentum in Model X deliveries, along with consistency in Model S deliveries.

According to these estimates, Tesla’s revenue growth rate is likely to climb further in coming quarters. In 2Q16 and 3Q16, Tesla’s YoY revenue growth rate is estimated to be at 72.7% and 86.1%, respectively.

Why such high expectations?

After Tesla’s Model X deliveries began in 2015, the company needed to demonstrate that it could deliver supernormal revenue growth in 2016. Tesla’s performance in fiscal 2016 is thus crucial in deciding its future growth prospects. These growth estimates for revenue look quite high, but such tremendous revenue growth is quite normal for a company in its startup phase.

Currently, Tesla Motors has only two EVs (electric vehicles), the Model S and the Model X. This is in contrast with a large vehicle portfolio offered by other legacy automakers (XLY) such as General Motors (GM), Ford (F), and Toyota (TM).

Continue to the next part for a look at analyst estimates for Tesla’s gross margins.


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