Tesla Profit Top Estimates; But Stock Falls

(RTTNews) - Electric car maker Tesla Motors Inc. (TSLA) Wednesday reported a swing to profit in the third quarter, led by robust sales of its Model S electric luxury sedan. While quarterly earnings topped Wall Street estimates, sales fell short of expectations.

Moving forward, Tesla, while confident of deliveries for the fourth quarter, said it expects adjusted earnings for the period to be on par with the third quarter, falling short of analysts' expectations. The company also plans to ramp up expenses for product development.

Investors were disappointed with the results, sending Tesla shares tumbling 11 percent in after-hours trade on the Nasdaq.

The Palo Alto, California-based company posted a quarterly net loss of $38.5 million or $0.32 per share, compared with a net loss of $111 million or $1.05 per share last year.

Results for the quarter include stock-based compensation expense of $21.4 million, compared with $12.5 million in the prior year.

Excluding items, adjusted earnings for the quarter were $16 million or $0.13 per share, compared with adjusted loss of $97 million or 0.92 per share a year ago.

On average, 13 analysts polled by Thomson Reuters estimated earnings of $0.11 per share for the quarter. Analysts' estimates typically exclude special items.

Sales for the quarter surged to $431 million from $50 million in the prior year. Analysts estimated sales of $534.64 million.

Tesla delivered 5,500 Model S cars during the quarter, including over 1,000 deliveries to European customers. It began to take reservations in China and now expects the first Model S deliveries there in the first quarter of 2014.

Tesla said its production rate for the quarter was almost 550 cars vehicles per week and that it plans to increase output over the next several quarters.

Meanwhile, cost of sales for the quarter were $328.5 million, compared with $59 million a year ago, and operating expenses climbed to $133 million from $100 million.

While Tesla expects fourth-quarter earnings on a level with the third quarter, analysts currently expect earnings of $0.20 per share.

The company plans to deliver slightly under 6,000 Model S vehicles in the fourth quarter and now expects fiscal 2013 worldwide deliveries to be higher by 200 units at 21,500 vehicles.

Tesla Motors rose to fame by producing the Tesla Roadster, the first fully electric sports car, followed by the Model S, a fully electric luxury sedan. Its rivals include General Motors Co. (GM) and Toyota Motors Corp. (TM).

Tesla's stock closed Tuesday at $176.81, up $1.61 or 0.92%, on a volume of 20.5 million shares. In after hours, the stock dropped $19.76 or 11.18% at $157.05. In the last year, the share traded in the range of $29.85 - $194.50.