Tesla's profit fails to please analysts

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Mr Musk also announced the firm's chief financial officer Deepak Ahuja was retiring, but said he would continue to serve as a "senior adviser" for "probably years to come".

Chief Executive Elon Musk touted strong demand for the Model 3, as the company begins to ship the vehicle to Europe and Asia from its Fremont, California factory. He said it should be here by the end of 2020.

The quarterly profit was less than half of the $311.5 million the company had earned in the three months to September.

"I expect the demand for the Model Y will be maybe 50% higher than the Model 3", Musk said, adding that he saw annual demand for the existing Model 3 at around 700,000 to 800,000 units a year, and maybe as low as 500,000 if a recession emerges.

So no, Musk did not "just" release all of Tesla's patents in an attempt to fight climate change.

"It's very important to get those cars, especially to China, as soon as possible". Nevertheless, Musk stated, "The demand for Model 3 is insanely high".

In the most recent quarter, Tesla earned $7.2bn in revenues, primarily from vehicle sales, more than double the same period in 2017.

"It is critical that we continue this trend so that we can keep increasing the affordability of Model 3 while retaining a sustainable level of profitability", the company said.

Yet, as Model 3 expansion efforts and production ramp progress in 2019 across the globe, Tesla should realize significant economies of scale. Musk gave a "rough guess" that Tesla would begin building its originally promised $35,000 version around the middle of this year.

Production of the Model Y will most likely take place at Tesla's Gigafactory 1 in Nevada (where its batteries are made), allowing the EV maker to make the batteries and put them straight in the new EVs fresh off the production line. Musk also assured investors Tesla will be able to "comfortably" pay off a $920m convertible bonds maturing in March. Revenues generated in Q4 amounted to $7.23 billion against average estimates of $7.08 billion.

"Tesla has a fantastic brand, and by all accounts a fantastic product, but we're anxious it's also fantastically expensive", said Nicholas Hyett, Equity Analyst at Hargreaves Lansdown.

The winding down of a USA tax subsidy this year will make all Tesla cars more expensive and could hurt sales. In the fourth quarter of 2018, 63,359 Model 3s were delivered compared to 1,550 in 2017. 2019 could prove a make or break year'. Tesla recognizes revenue once a vehicle is delivered. Tesla said it was working through its Model 3 backlog without clarifying further.

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