10-QPeriod: Q1 FY2011

Tesla, Inc. Quarterly Report for Q1 Ended Mar 31, 2011

Filed May 13, 2011For Securities:TSLA

Summary

Tesla, Inc. (TSLA) filed its Form 10-Q for the quarterly period ending March 31, 2011, reporting significant revenue growth and continued investment in future products. Total revenues more than doubled year-over-year, driven by a substantial increase in automotive sales, primarily from powertrain component sales to Daimler AG and higher Tesla Roadster deliveries. Development services revenue also saw a dramatic increase, largely due to work with Toyota on the RAV4 EV program. Despite the strong top-line growth, the company continued to operate at a net loss, which widened compared to the prior year. This increase in net loss was primarily attributed to a significant rise in research and development expenses, heavily influenced by investments in the Model S program, including alpha prototype development and manufacturing facility preparations. Selling, general, and administrative expenses also increased to support global sales and marketing expansion. The company ended the quarter with a healthy cash and cash equivalents balance, supported by drawdowns under its Department of Energy loan facility, indicating sufficient liquidity for its near-term operational needs and planned Model S development.

Financial Highlights

24 data points
Beta

Revenue

$49.03M

36.8% Gross Margin

Net Income

-$48.94M

-99.8% Net Margin

Cash & Equivalents

$100.66M

Free Cash Flow

-$63.77M

Financial Statements
Beta
Revenue$49.03M
Cost of Revenue$31.00M
Gross Profit$18.03M
R&D Expenses$41.16M
SG&A Expenses$24.21M
Operating Expenses$65.37M
Operating Income-$47.35M
Net Income-$48.94M

Key Highlights

  • 1Total revenues increased 136% year-over-year to $49.0 million, driven by a 63% increase in automotive sales and a substantial rise in development services revenue.
  • 2Automotive sales benefited from increased powertrain component shipments to Daimler AG for the Smart fortwo and A-Class programs, alongside higher Tesla Roadster deliveries.
  • 3Development services revenue surged due to work on the Toyota RAV4 EV program, with significant milestones achieved and additional revenue expected.
  • 4Research and Development (R&D) expenses more than tripled to $41.2 million, primarily reflecting increased investment in the Model S program, including alpha prototype builds and manufacturing facility preparations.
  • 5The company reported a net loss of $48.9 million for the quarter, a widening from the $29.5 million net loss in the prior year's comparable quarter, due to higher operating expenses.
  • 6Cash and cash equivalents stood at $100.7 million, with total available liquidity, including restricted cash and DOE loan facility availability, at $506 million.
  • 7Capital expenditures increased significantly to $20.5 million, reflecting investments in the Fremont manufacturing facility and Model S-related equipment, with full-year capital expenditure guidance ranging from $190 million to $215 million.

Frequently Asked Questions

The primary driver of Tesla's revenue growth was a substantial increase in automotive sales, notably from powertrain component sales to Daimler AG and higher deliveries of the Tesla Roadster. Additionally, development services revenue, primarily from the Toyota RAV4 EV program, also contributed significantly to the revenue increase.

The net loss widened primarily due to a significant increase in operating expenses, particularly in Research and Development (R&D). R&D expenses more than tripled, driven by substantial investments in the development of the Model S vehicle program, including alpha prototype builds and preparations for manufacturing. Selling, general, and administrative expenses also rose due to global sales and marketing expansion.

Tesla ended the quarter with $100.7 million in cash and cash equivalents. The company reported total principal sources of liquidity of $506 million, which includes cash and cash equivalents, cash held in a dedicated DOE account, and $362.5 million available under the Department of Energy (DOE) loan facility. This funding is crucial for ongoing operations and the development of the Model S program.

Tesla made significant capital investments in the quarter, totaling $20.5 million, primarily for the Fremont manufacturing facility and Model S-related equipment. The company anticipates this trend to continue, with full-year capital expenditures projected to be in the range of $190 million to $215 million, largely to support the Model S development and manufacturing infrastructure.