Tesla picks up on better quarterly performance

Tesla Motors on Wednesday ended a string of mild earnings disappointments that raised questions about its management execution, as it reported a better performance in its latest quarter than Wall Street had been expecting.

At the same time, Elon Musk, chief executive, said the US electric carmaker had seen a surge in orders for the stationary batteries it announced less than a week ago.

"We're basically sold out to the middle of next year in the first week - it's crazy," Mr Musk said on a conference call with analysts.

Hopes for the new stationary batteries have contributed to a rebound of 25 per cent in Tesla's shares from a low point in late March, helping to quell Wall Street concerns about the extent of demand for its electric vehicles. The batteries are designed for residential customers to store excess power from their solar systems, as well as for companies and electric utilities looking to even out periods of peak and low demand by storing power for when it is needed.

Tesla had suffered a number of glitches since the middle of last year that took the shine off its results, from the dent to production from a factory overhaul to misfiring with its launch in China and a shortfall in shipments at the end of 2014 that it blamed on an inability to deliver cars over the holidays.

For the first quarter of this year, Tesla reported a loss of 36 cents per share on revenues of $1.1bn. Analysts had been expecting a loss of 50 cents a share on revenues of $1.04bn.

The company also produced more vehicles than expected in the period, with 11,160 compared to the 10,000 that had been expected.

The figures were helped by the launch of its new dual-motor model, the P85D, which raised the company's average selling prices. However, Tesla said that average selling prices, in dollar terms, would be hit by the strength of the US currency in the current quarter.

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Tesla reiterated its shipment target of 55,000 vehicles this year, implying a big increase in quarterly shipments in the second half after the launch of its Model X sport utility vehicle. Mr Musk said he expected a big jump in the final quarter with revenues doubling, though he also warned that this depended on a smooth ramp-up of production of the X, which was highly dependent on the availability of parts.

Tesla shipped 10,045 vehicles in the first quarter, slightly ahead of the 10,030 it had reported in a preliminary estimate a month ago and up 55 per cent from the year before and ahead of most analysts' forecasts of 9,500. The figure included 1,400 shipments the company failed to record at the end of 2014. At the time, Tesla said it had been unable to make deliveries to customers who were on vacation, leading to a substantial shortfall in revenues for the period.

On the call with Wall Street analysts, Mr Musk described demand for the company's new stationary batteries as "just nutty", and strong enough to take up all the output from the so-called "gigafactory" it is building to meet the expected need for car batteries from its planned push into mass-market vehicles. Tesla has received 38,000 orders for residential batteries and 2,400 for larger-scale commercial battery packs, Mr Musk said.

Tesla shares, which have gained nearly 11 per cent in the past year, rose 2 per cent to $235.00 in after-hours trading.

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