Tesla Q1 revenue 4,5 billion dollars – profitable again in Q3

The SUV cars manufacturer Tesla (TSLA)  published its Q1 figures and according to the release, the Q1 revenue was 4,5 billion dollars during the period. The Refinitiv estimate was 5,2 billion dollars. The interim report was published after the trading closing in Wall Street on Wednesday evening.

– We expect Tesla to return to profitability in Q3 and significantly reduce our loss in Q2, said the CEO Elon Musk in the release.

The company operating loss was 522 million dollars during the quarter and net loss 702 million dollars, which include 188 million dollars of non/recurring charges. The loss per share was 4,10 dollars compared a profit of 0,81 dollars at the year end and loss of 4,19 dollars a year ago.

The company ended the quarter wiht 2,2 billion of cash, which shows  a 1,5 billion dollars reduction the the year end situation. The reason behind was the 920 million convertible bond repayment and the increase of number of vehicles in transit to customers.

The company has announced earlier that the Q1 deliveries were 63.000 vehicles, when the market estimates were 76.000 vehicles. These  challenges have caused vehicle deliveries to shift into Q2.

Tesla started  production and delievires of Model 3 vehicles for overseas markets during the first quarter. And this was also one of the reasons for delays in deliveries and shifts to the Q2. Tesla said it will focus further to improve operations, cost efficiency and customer experience globally.

– If our Gigafactory Shanghai is able to reach volume production early in Q4 this year, we may be able to produce as many as 500 000 vehicles globally in 2019. This is an aggressive schedule, but it is what we are targeting. However, based on what we know today, being able to produce over 500 000 vehicles globally in the 12/month period ending June 30, 2020 does not appear very likely, he said in the release.

According to Musk, the company operating cash flow less capex should be positive in every quarter, including the Q2. And due to the cost reduction and higher deliveries, the company should return to profitability in Q3.

Tesla shares closed down nearly 2 percent today in Wall Street. The stock closed -1,99 % to 257,85 dollars.

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New York Times – Microplastics also in the air

Microplastics can be found also in the air. According to the New York Times, French researchers have found thousands and thousands of microplastic particles raining down in the Pyreneers. Microplastics, which are source of the water and ocean pollution, may also travel by air.

According to the article 11.400 pieces of microplastic per square meter per month, on average was the research outcome. Researchers, lead by Deonie Allen, called them invisible atmospheric pollutants. According to the study a lot of microplastic pollution comes from cities, landfills and farms that have sprayed with wastewater treatment sludge.

Some countries, including Britain, have banned the use of microplastic or microbeads  for example in cosmetics in order to avoid the pollution inflow to rivers and seas.

The European Chemical Agency, Echa, has proposed EU-wide restrictions by 2020 on using deliberately added microplastics in products like cosmetics, paints, coatings, fertiliser granules and medical devices in order to reduce plastic waste.

According to the estimate  about 70.000 -200.000 tonnes of added microplastics end up in the environment each year.

Business Research and Insights

Tesla Q1 release on Wednesday next week  – new governance guide

The US electric car manufacturer Tesla (TSLA) has announced that the company Q1 information will be released on Wednesday, the 24th April. Also the Investor Day related to Autonomous driving would be next week Monday the 22nd April.

Tesla published a couple of weeks ago its last year production figures. According to that, Tesla produced approximately 77 100 total vechiles, of which were 62 950 Model 3. Deliveries were approximately 63000 vehicles, which was 110 % more than the same quarter last year. Also Tesla confirmed that the guidance for this year would be 360000-400000 vehicles deliveries.

Yesterday the company also announced changes to its board. According to information Brad Buss and Linda Johnson Rice wil not seek re-election, which means that the Board size will decrease to nine. The company has also published new governing rule which cuts the term to two years instead of three. This means that there would be also changes in the Board during 2020. The annual shareholder meeting will be on June, the 11th. The new governing rule will help shareholders vote on the Board performance more frequentely.

Tesla share rose 0,75 % to 273,26 dollars in New York before the Easter holidays. During one year period the share has declined 5,85 %. During 2019 the share has plunged 18 %.

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China Silk Road Summit – constructive suggestions welcome

The China Silk Road will be one of the topics next week, when the country is arranging a Summit around the theme.The Belt and Road Initiative is a key initiative of the President Xi Jinping to rebuild the old Silk Road from China to Europe and beyond.
The Initiative has got questions about the Chinese influence abroad and the possible unsustainable long-term financial arrangements and also human rights. According to Reuters, the US Goverment will send only low level representatives to the event, while the countries are also working with the trade talks.

Chinese top diplomat, State Councillor Wang Yi told media representatives that the Initiative have brought real benefits to participating countries.

– The partnership relationship is not geopolitical tool, but a platform for co-operation, he said on Friday.

According to the China Goverment, the State is welcoming all to come up with constructive suggestions while the Initiative will be developing over time.

The Summit will be at the end of April and countries like Pakistan, Russia, Switzerland and Austria will be sending their foreign leaders to the Summit. More than 150 countries are sending their delegations to the Summit. Italy was the first G7 country to sign the partnership last month.

Business Finance

Uber self-driving unit gets 1 billion dollar investment

The self-driving unit of Uber has got one billion dollar investment. The company confirmed that three Japanese companies Denso, Toyota and Softbank have bought stakes in that unit. According to Bloomberg, the value of the unit is 7,25 billion dollars.

According to Uber the deal is expected to close during the third quarter. The company is also preparing for the IPO in May in New York.

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Pinterest rose over 28% in New York IPO – target 250 million users

The US social commerce company Pinterest (PINS) listed today in the New York Stock Exchange. The stock rose over 28 % above its IPO price, valuing the company to nearly 13 billion dollars.

The IPOs of Pinterest and the video service company Zoom Video Communications (ZM) showed increased investor confidence after the disapointments related to the stock performance of the ride-hailing company Lyft (LYFT)  IPO  in the early April. According to Bloomberg, Lyft is trading down 19 % from its IPO price

This trend gives more momentum also to the second ride-hailing company Uber to list in May. Uber is expected to raise about 10 billion dollars, which would value the company at 100 billion dollars. Also Airbnb is in the pipeline.

Pinterest is serving its users like a digital platform for inspiring visual arts for fashion, weddings, recipes and more. This San Fransicso-based company is targeting more than 250 million monthly active users.

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