Earnings stall Tesla's share price rise

Tesla Motors stayed on track to hit its goal of delivering 35,000 vehicles in 2014, as it reported quarterly results that met its own and Wall Street forecasts.

The US electric carmaker also registered progress in its efforts to squeeze greater efficiencies out of its supply chain. Its gross profit margin rose by 1.4 percentage points to 26.8 per cent on a pro forma basis, ahead of expectations of 26 per cent.

Shares in the company, which had risen 48 per cent since the start of the year, slipped 2.5 per cent in after-hours trading.

In a statement issued ahead of a call with analysts, Elon Musk, chief executive officer, said Tesla had broken ground for construction of the giant battery factory needed to support its ambitions of becoming a mass-market producer.

Work had begun at a site near Reno, Nevada, though the company is still evaluating sites in four other states, he said.

Tesla said it had delivered 7,579 vehicles in the second quarter, slight more than the 7,500 it had forecast. It produced 8,763, also in line with expectations, reflecting the build up of vehicles in the distribution pipeline as it expands sales in Asia and Europe.

Deliveries are forecast to hit 7,800 in the third quarter with production rising to 9,000, Mr Musk said. The rising output is expected despite a two-week production shutdown, forced by a move to a new assembly line, that would cost around 1,700 deliveries in the quarter, he added.

Tesla reported revenues of $769m, up 90 per cent from the year before, and pro forma net income of $16m, or 11 cents a share, compared to the 4 cents a share analysts had been expecting.

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