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Autonomous Vehicles

Tesla Reports Big Cash Burn in First Quarter

As expected, electric carmaker Tesla on Wednesday said it burned cash in the first quarter of the year after two successive quarters in which it generated $900 million in free cash flow. But the first quarter burn of $919 million means Tesla has just $2.2 billion left in cash. Tesla said, however, that it expects to generate positive free cash flow for the next three quarters and generate a profit in the third quarter while continuing to boost vehicle production.

That may have calmed investor nerves: Tesla stock was up marginally after hours. Investors may also have been pleased by CEO Elon Musk’s statement on a conference call that there is “merit” to the idea of raising capital, a change from the past year or so when he said it was not in the cards. 

And some bad news was baked in. Tesla three weeks ago disclosed a dip in deliveries in the first quarter, in part due to weaker electric car demand in the U.S. after the end of a tax credit, and its stock tumbled on that news.

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