Tesla Loses $75M In Net GAAP Income In Q3 2015

Cameron Aubernon
by Cameron Aubernon
tesla loses 75m in net gaap income in q3 2015

Tesla’s Q3 2014 earnings report had a few pluses (record deliveries of the Model S, high demand for the D trim sedans) and minuses (the third delay of the Model X, removal of brown and green from the Model S palette). The biggest minus, however, was its bottom line: A net loss of $75 million in GAAP income.

AutoNews reports the loss in Generally Accepted Accounting Principles income is double what Tesla lost in Q3 2013. Cash on-hand also decreased in the quarter, falling $304 million to $2.4 billion. Non-GAAP net income was $3 million, or just 2 cents per share based upon 142.7 million diluted shares.

Overall income from the 7,785 units delivered this period came out to $932 million in non-GAAP income, $852 million once GAAP is applied. Regulatory credits totalled $93 million, with $76 million in ZEV credits, thanks to the closure of additional contracts with a number of OEMs.

R&D spending climbed 28 percent over the previous quarter, hitting $119 million non-GAAP, $136 million GAAP. The expenses came as a result of work on the oft-delayed X, the D’s dual-motor drivetrain, and the new Autopilot semi-autonomous driving system.

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  • SCE to AUX SCE to AUX on Nov 07, 2014

    The anti-Tesla parade here is getting so predictable it's funny. GAAP non-GAAP stock price overvalued ego every mfr could do this etc, etc.

    • See 3 previous
    • Wolfinator Wolfinator on Nov 07, 2014

      @Pch101 Musk's ego is so big, it's literally spawned 4 multi-billion dollar businesses. His ego is truly something to behold.

  • WriterRRex WriterRRex on Nov 07, 2014

    Is there an "extra" income that comes in from the sales? If I did the math correctly, non-GAAP income per car is $119,717 per car. (GAAP income per car is $109,441.) I thought most Model S's sold in the $85-100K range. Do they routinely sell for more than sticker? And, if so, how are those extra sales profits handled? Guess I'm really asking what other income streams are rolled into that figure. And, certain that those income figures are before deductions for manufacturing costs. (Yeah, I haven't had enough coffee today, and yeah, I haven't closely exampled the company's statements--being lazy!)

    • Pch101 Pch101 on Nov 07, 2014

      The main difference is in the lease accounting. A portion of the revenues under GAAP is deferred because of the leases.

  • Hummer Hummer on Nov 07, 2014

    There is a fundamental problem here, it is absolutely impossible for anyone not in the top 10k richest list to start a auto company. The requirements to sell vehicles is so long that it would be impossible to even build a prototype that could pass regulations for under a million dollars. And as time goes on, and automakers keep merging and destroying brands, eventually we're going to have 3-5 companies controlling all major brands. I want to see Tesla succeed only because Elon is breaking into a market that's almost uncrackable for new entries, and facing uphill battles every step of the way by companies with multiple times the cash and power, all with drastically more auto sales. Though it's upsetting seeing even a billionaire having such struggles. I don't know if electric cars are the way to win entry into the market, and so far it seems more like a fad than a legitimate entry, but I'm glad to see someone do it. It would be nice to see regulation aimed at protecting start-ups. Say under 10k sales company wide, minimum requirements, 1980 level emissions, 2000s safety, no backup cameras or other wasteful requirements. And gradually increase requirement levels with increasing company wide sales. Though I believe a truly successful and exciting idea would have a larger company waiting with a bag of money lined up to buy the rights to your idea, see AM General.

  • Baconator Baconator on Nov 07, 2014

    GAAP numbers are basically as objective as poetry. Cash is king. And what their cash flow statement tells you is that the company brought in $29 million in cash from operations over the quarter. $29M in free cash flow is nothing to sneeze at.

    • Pch101 Pch101 on Nov 08, 2014

      Cash flow from operations can be managed simply by deferring R&D. Judging from the product delays, that's exactly what Tesla is doing. That's prudent in the short run, but not sustainable over the long run. The company will need to produce sufficient profit to feed the need for investment, a problem that gets to the heart of why independent automaking is likely to produce losses or only minimal profit.