Reviewing 2Q17 earnings
In 2Q17, Tesla (TSLA) reported a net loss of $1.33 per share on a non-GAAP (generally accepted accounting principles) and a GAAP loss of $2.04 net loss per share. These results were much better than the analysts’ estimates of a non-GAAP per share loss of $1.76. In 2Q16, the company reported a GAAP loss of $2.09 per share.
Tesla’s higher-than-estimated earnings triggered a positive reaction on Wall Street. Its stock rose 2% on the day of its 2Q17 earnings release.
3Q17 earnings estimates
Analysts expect Tesla’s 3Q17 earnings to be in the negative territory. According to the estimates, the company is likely to report a non-GAAP loss of ~$2.26 per share. These expectations are worse than TSLA’s reported loss of $0.71 in the same quarter last year.
In 3Q17, Tesla’s car deliveries rose ~18.7% on a QoQ (quarter-over-quarter) basis, but its production fell 1.4% QoQ. Tesla is a fairly new entrant in the automobile industry (XLY), compared with legacy auto companies Ford Motor (F) General Motors (GM), and Fiat Chrysler Automobiles (FCAU), and so Tesla investors will likely be paying attention to QoQ growth along with year-over-year growth.
Notably, in order to increase the production of its Model 3, the company’s expenses could rise significantly. These higher expenses could hurt Tesla’s 3Q17 earnings results.
Continue to the next part to learn about the analysts’ recommendations for Tesla stock ahead of its 3Q17 earnings release.