Tesla burns through less cash than expected in second quarter
Elon Musk’s company still promising profit just around the corner
Tesla ended June with $2.24 billion in cash. Photograph: Reuters
Tesla burned through less cash than analysts’ expected last quarter and stood firm with chief executive Elon Musk’s projection that profit is around the corner after years of losses.
Free cash flow was negative $739 million (€634 million) for the three months ended in June, Mr Musk wrote in a letter to shareholders on Wednesday. Analysts were projecting the company would go through about $900 billion during the period, after burning more than $1 billion in three of the previous four quarters.
Tesla ended June with about $2.24 billion in cash on its balance sheet. Mr Musk has insisted the company won’t need to raise more capital this year. That’s a view Wall Street has doubted after the company repeatedly pushed back manufacturing targets for the Model 3, the sedan central to the company’s mission when it was founded in 2003 – to bring electric vehicles to the masses.
“It took 15 years to execute on our initial goal to produce an affordable, long-range electric vehicle that can also be highly profitable,” Mr Musk and chief financial officer Deepak Ahuja wrote in the letter.
“In the second half of 2018, we expect, for the first time in our history, to become both sustainably profitable and cash flow positive.”
Tesla shares surged as much as 4.9 percent to $315.51. – Bloomberg