Tesla Inc Chief Executive Elon Musk suggested on Wednesday a capital raise could be imminent, as the electric vehicle maker lost $700 million in the first quarter and predicted a return to profit in the third.
(Reuters) — Tesla Inc Chief Executive Elon Musk suggested on Wednesday a capital raise could be imminent, as the electric vehicle maker lost $700 million in the first quarter and predicted a return to profit in the third.
Tesla plans to resolve logistics issues with global vehicle deliveries after weathering a challenging few months, also marked by staff layoffs and a public spat between Musk and U. S. financial regulators.
Shares of Tesla, which are down 22 percent this year, were about flat after the results, which came more than an hour after they were expected.
Musk is still battling to convince investors that demand for the Model 3, the sedan hoped to propel Tesla to sustainable profit, is “insanely” high, and that it can be delivered efficiently and swiftly to customers around the world. Lower deliveries had added to worries over Tesla’s cash situation and increased speculation a capital raise was coming soon.
On a call following results, Musk also stepped back from an earlier prediction that the company’s Shanghai factory, which is currently being built, would likely produce 3,000 Model 3s per week by year’s end. Instead, the so-called Gigafactory would build 1,000, or maybe 2,000 per week by the end of the year, he said.
Many analysts had predicted the company would need to raise funds for its expansion, including the Shanghai factory, the upcoming Model Y SUV, and other projects.
