Reportedly, Tesla (TSLA), reported sales that fell short of Wall Street estimates, due to delivery and production bottlenecks, prompting the CEO to assure investors that demand for his company’s cars continues to remain strong.
Investors are paying close attention to how quickly Tesla can increase the output of its mass-market Model Y SUV from new factories in Austin and Berlin, a key milestone for the EV maker. The company blamed its sales miss on difficulties shipping vehicles at the end of the quarter and informed that the profit growth was tempered by higher costs related to a slower-than-expected ramp-up at its two newest factories.
The third-quarter revenue jumped to $21.5 billion compared with analysts’ estimates of $22.1 billion. Profit excluding some items rose to $1.05 a share, exceeding the $1.01 average of estimates. Income from the sale of regulatory credits, used by other automakers to offset greenhouse gas emissions stood at $286 million for the quarter, the lowest in a year. Tesla’s automotive gross margin narrowed to 27.9% in the quarter, falling short of the 28.4% average of estimates.
Citing the company’s profitability and growing cash balance of $21.1 billion, Musk informed Tesla could repurchase $5 billion to $10 billion of its shares, subject to board approval and review.
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