Tesla Shares Jump on Record Delivery Numbers in Second Quarter

The closely-watched electric-vehicle producer exceeded analyst estimates after missing them by a wide margin in the first quarter.
By Rob Daniel ,

Tesla (TSLA) - Get Report  said after the bell Tuesday that it delivered and produced record numbers of vehicles in the second quarter, sending the shares up sharply in after-hours trading.

The closely watched Palo Alto, Calif., electric-vehicle producer delivered 95,200 vehicles in the period, 4.6% ahead of a 91,000 estimate compiled by FactSet.

And it produced more than 87,000 vehicles, Tesla said in a Tuesday statement.

Tesla shares are up 7.4% in after-hours trading at $241.05.

The previous record for total deliveries, 90,700, was set in the fourth quarter of 2018.

The figures come less than a month after CEO Elon Musk told shareholders at the company's annual meeting that there was a  "decent chance" of a record during the quarter. 

Deliveries of the company's lowest-priced car, the Model 3, came in at 77,550, 4.7% ahead of the FactSet estimate of 74,100.

Tesla defines a delivered car as one transferred to a customer with all paperwork correct. Tesla said the second-quarter delivery count "should be viewed as slightly conservative."

The company said its backlog for third-quarter 2019 has risen, since orders generated during the second quarter exceeded deliveries.

TheStreet's Anton Wahlman, a columnist and noted Tesla bear, expressed skepticism about the results, saying that "95,200 was almost precisely in the midpoint of the company's guidance of 90,000 to 100,000."

Wahlman, who is short the stock, said some market watchers had speculated that Tesla's sales would come in lower, at around 90,000, but that the company beat those expectations due to "massive discounting during the quarter."

The columnist said that "when the company discounts so much, that is rarely a good sign for demand." Wahlman expects Tesla's second-quarter earnings report will show "the extent to which they destroyed the margins in order to achieve the unit number."

Adding to Tesla's challenges going forward, federal tax credits for purchasing one of the company's cars fell by half on July 1 to $1,875.

On a more optimistic note, Wedbush Securities analyst Daniel Ives said that "with Musk and Tesla's back against the wall and many doomsday predictors abound, the company came through swinging with a strong second-quarter delivery unit number that will help restore credibility to the story in the near-term."

Musk, the analyst said, "talked the [talk] but finally walked the walk this quarter." Ives affirmed his neutral rating and $230 price target on Tesla shares.

Tesla has been laboring to meet aggressive targets.

In its first-quarter report, it affirmed that it would deliver 360,000 to 400,000 vehicles in 2019, up 45% to 65% from 2018. Analysts say that's a high bar since it delivered a lower-than-expected 63,000 vehicles in the first quarter.

And a number of senior Tesla officials recently left the company.

Business Insider reported on Tuesday that Tesla's vice president of interior and exterior engineering, Steve MacManus, departed. Electrek reported on Tuesday that Jan Oehmicke, Tesla's Europe-operations chief, exited.

A week ago Reuters reported that the vice president of production at the Fremont, California, factory, Peter Hochholdinger, had left.

And also in June, the company's VP human resources and head of diversity, Felicia Mayo, stepped down.

Save 57% with our July 4th Sale. Join Jim Cramer's Action Alerts PLUS investment club to become a smarter investor! Click here to sign up!

Loading ...