Tesla posts third-quarter profit after Model 3 production glitch

Tesla Inc. said it earned $1.6 billion in the third quarter after the electric carmaker drastically scaled back production and delayed selling more Model 3 sedans. Tesla released the results and its forecasts for…

Tesla posts third-quarter profit after Model 3 production glitch

Tesla Inc. said it earned $1.6 billion in the third quarter after the electric carmaker drastically scaled back production and delayed selling more Model 3 sedans.

Tesla released the results and its forecasts for the fourth quarter on Friday. It anticipated more than 300,000 deliveries in 2019, up sharply from 50,000 this year. Chief Executive Officer Elon Musk said in October that Tesla would miss its Model 3 delivery target in the quarter. While that’s now been repeated, Musk’s references to production topping 2,000 a week were tempered slightly.

That development is part of a broader review of Tesla’s manufacturing prowess after it missed another key target this year. The company has said it’s taking steps to correct its problems, including introducing new designs for factories.

There are signs of improvement. Chief Technical Officer JB Straubel said this week that Tesla has hired more workers at its Fremont, California factory and plans to reduce production bottlenecks. Musk said last month that the company was meeting or exceeding its output goals.

The quarterly results demonstrate “that it was possible, technically, to produce 2,500 cars in September when they say they missed their target by 25 percent,” said CFRA Research analyst Efraim Levy. “They didn’t lower their guidance so much they missed guidance.”

Tesla expects its GAAP net loss to be as much as $1.6 billion in the quarter, or between $4.21 and $4.88 a share. It forecasts $2.4 billion in revenue. Analysts, on average, had expected Tesla to report a quarterly loss of $3.63 a share, according to data compiled by Bloomberg.

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