Analysts expect Tesla Motors (TSLA) to show that it has reined in its losses when the automaker releases its third quarter earnings Wednesday after more than doubling analysts' loss expectations last quarter.
Investors polled by FactSet expected the California-based company, led by South African investor and engineer Elon Musk, to post a loss of 53 cents per share—an improvement from last year’s third quarter losses of $1.78 per share and second quarter losses of $1.06 per share. Analysts surveyed by Reuters, however, estimated the company's earnings per share (EPS) would turn positive, hitting 37 cents for the quarter ending in December.
Such optimistic forecasts are likely fueled by Tesla's announcement that it saw a 70 percent rise in third-quarter deliveries early in October—welcome news after, two months earlier, it disclosed third quarter expenditure needs of $1.1 billion.
The earnings report will come one week after the automaker announced all of its cars currently in production would be self-driving, with “a safety level substantially greater than that of a human driver.” If the Enhanced Autopilot software wins regulatory approval, Tesla will activate the option in its Model 5 and Model X cars in December.
But Tesla’s use of the Autopilot feature hasn’t been smooth so far. In January, a driver using the software in China was killed when the car struck a road sweeper on a highway. In May, a man in Florida using the driver-assist system died when his Model S failed to discern an 18-wheel tractor-trailer crossing a highway.
As a result of the Florida incident, the National Highway Traffic Safety Administration (NHTSA) launched an investigation into the cars in June, and could fine Tesla as much as $105 million for violating the Vehicle Safety Act.
Tesla’s Autopilot technology isn’t the only factor making headlines for the company. In August, Tesla bought solar energy company SolarCity for $2.6 billion. Musk called the decision a "no brainer," though it was widely criticized due to the extensive capital needs for both solar and auto technology, SolarCity’s ineffective business model and the lack of synergy between the two companies’ products.
Tesla’s share price fell from a high of $203.50 to just above $200 on Monday morning. The company’s shares have seen a volatile year, with a low of just over $143 in February and a high of over $265 in April.