01—Abstract
Summary
Summary of the 10-K filed March 1, 2017. Cited figures are marked; the original filing is the authoritative source.
This 10-K filing for Tesla, Inc. for the fiscal year ending December 31, 2016, highlights a period of significant growth and strategic expansion.
The company continued to ramp up production and deliveries of its Model S and Model X vehicles, while also making substantial progress on the development of the highly anticipated Model 3, with volume production targeted for the second half of 2017. A major development during this period was the acquisition of SolarCity Corporation in November 2016, integrating solar energy systems and storage solutions into Tesla's broader mission of accelerating the world's transition to sustainable energy. Financially, Tesla experienced substantial revenue growth, driven by increased vehicle sales and the inclusion of SolarCity's financials.
However, the company also reported a net loss, reflecting continued heavy investment in research and development, manufacturing capacity expansion (particularly at Gigafactory 1), and the aggressive scaling of its sales, service, and Supercharger network. Significant capital expenditures were planned for 2017 to support the Model 3 ramp and ongoing operational growth. The company also maintained a robust debt structure to finance its expansion, with ongoing efforts to manage liquidity and capital resources effectively.
02—Key points
Key Highlights
- Tesla's mission is to accelerate the world's transition to sustainable energy, encompassing high-performance electric vehicles and energy storage solutions.
- The company continued to increase vehicle production and deliveries, with a 64% year-over-year increase in vehicle production for 2016.
- Significant progress was made on the Model 3, with volume production and deliveries targeted for the second half of 2017.
- The acquisition of SolarCity Corporation closed on November 21, 2016, integrating solar energy systems and energy storage into Tesla's business.
- Tesla is making substantial investments in its manufacturing capabilities, notably at Gigafactory 1, to support the production of battery packs and drive units.
- The company is expanding its global sales, service, and Supercharger infrastructure to support its growing vehicle fleet and customer base.
- Total revenues for the year increased significantly to $7,000,132,000, driven by automotive sales and the inclusion of SolarCity's operations.
03—One dollar
Follow one dollar
For each $1.00 of revenue in FY2016, Tesla, Inc. lost $0.10.
- Revenue$7.00B100.0%
- Cost of revenue−$5.40B77.2%
- Gross profit$1.60B22.8%
- Operating costs−$2.27B32.4%
- Operating income−$667.3M9.5%
- Interest, other & tax−$7.6M0.1%
- Net income−$674.9M9.6%
04—Financials
Financial Highlights
Figures from 10-KFY2016filed March 1, 2017Financial Statements
FY2016 against FY2015
| Line item | FY2016FY2015 | Change |
|---|---|---|
| Revenue | $7.00B$4.05B | +73.0% |
| Cost of Revenue | $5.40B$3.12B | +73.0% |
| Gross Profit | $1.60B$923.50M | +73.2% |
| R&D Expenses | $834.41M$717.90M | +16.2% |
| SG&A Expenses | $1.43B$922.23M | +55.3% |
| Operating Expenses | $2.27B$1.64B | +38.2% |
| Operating Income | -$667.34M-$716.63M | +6.9% |
| Interest Expense | $198.81M$118.85M | +67.3% |
| Net Income | -$674.91M-$888.66M | +24.1% |
| EPS (Basic) | $-0.31$-0.46 | +32.5% |
| EPS (Diluted) | $-0.31$-0.46 | +32.5% |
| Shares Outstanding (Basic) | 2.16B1.92B | +12.5% |
| Shares Outstanding (Diluted) | 2.16B1.92B | +12.5% |
05—Questions
Frequently Asked Questions
What were Tesla's primary business segments in 2016?
In 2016, Tesla operated in two primary reportable segments: Automotive, which includes the design, development, manufacturing, and sales of electric vehicles, and Energy Generation and Storage, which encompasses the design, manufacture, installation, and sale or lease of stationary energy storage products and solar energy systems.
What was the impact of the SolarCity acquisition on Tesla's financial statements?
The acquisition of SolarCity on November 21, 2016, was accounted for using the purchase method. SolarCity's results of operations from the acquisition date through December 31, 2016, were included in Tesla's consolidated financial statements. The acquisition added $8.78 billion in assets and $84.1 million in revenues for the partial period included in the 2016 reporting.
What were Tesla's key financial performance indicators in 2016?
Total revenues grew to approximately $7 billion. The company reported a loss from operations of $667.3 million and a net loss attributable to common stockholders of $674.9 million. Despite the net loss, Tesla continued to invest heavily in capital expenditures, planning between $2.0 billion and $2.5 billion for 2017 to support Model 3 production and overall growth.
What are Tesla's major growth drivers and future plans mentioned in the filing?
Key growth drivers include the ramp-up of Model X production, the anticipated launch of Model 3 for the mass market, and the expansion of its energy generation and storage business following the SolarCity acquisition. Future plans involve continued investment in Gigafactory 1 for battery production, expansion of the global sales and service network, and development of new vehicle models and energy products like the solar roof.
06—Continue