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Tesla drops in premarket after Musk lets loose on call

05 May 2018
Tesla drops in premarket after Musk lets loose on call

Elon Musk lost his composure on Wednesday during Tesla's first-quarter earnings call, and now he's scrambling to clean up the mess. Musk also noted that there are "really big numbers" involved. "That's our focus right now". The cash burn could put pressure on the company to borrow more or sell additional shares to raise more cash.

"We're going to YouTube", the CEO said, turning to questions from users of the video sharing site.

Tesla began the quarter with $3.96 billion in cash and equivalents, but that fell to $3.22 billion by quarter's end.

As for the Model 3 reservations question, he described that as "absurd" on Twitter.

Still, the loss is up from $3.04 a share in the last quarter and $1.33 in the same quarter a year ago.

Still, he also conceded that his handling of the call could've been better.

Musk, who has tweeted about sleeping at the Tesla factory, said they've overcome automation failures like a "fluffer bot" that couldn't install fluffy fiberglass mats atop battery packs. Buyers plunk down $1,000 to reserve a Model 3.

During the conference call, the businessman ignored the issue of funding difficulties and problems with mass production of electric auto Model 3. It is aiming to hit at least 5,000 a week by summer.

"We need to become a profitable company", he said.

The electric vehicle manufacturer Tesla in the first quarter of 2018 suffered record losses.

"I'm not here to convince you to buy our stock", Musk said. According to the publication, the company records a financial loss for the fifth quarter in a row. It beat the expectations of consensus of analysts by Thompson Reuters I/B/E/S, which predicted a loss would be $3.58 a share. They might have even been able to stomach the US$8.3 million that Telsa Inc. burns through each day. During Wednesday's after-hours trading, TSLA went down as far as 7%.

Watch Tesla trade in real time here. At the end of past year the company had a total of $9.5 billion in long-term debt. But as a public company, Tesla has an obligation to investors and it obviously benefits the company to keep them happy.

"Clearly, he seems worn out and frustrated, and this is the wrong time to lash out at the investor community", James Albertine, an analyst with Consumers Edge Research, said on Bloomberg Television. At one point it had more than 500,000 potential buyers on a waiting list. The first-quarter loss hit almost $710 million with a cash burn of $745 million.