Tesla has best quarter ever

Elon Musk

On Wednesday, Tesla posted a Q4 2016 loss of $121.3 million, but the loss was narrower than the $320 million net loss from the year earlier. The company said it made $2.28 billion in revenue in the quarter, up from $1.24 billion in Q4 the year before. Tesla reported $7 billion in annual gross revenue in 2016.

All that comes on the heels of a Q3 in which the company posted a rare profitable quarter that CEO Elon Musk called Tesla’s "best quarter ever."

The company said its gross margin fell between the third and fourth quarters of 2016 due to lower Zero Emissions Vehicle credit sales in Q4 compared to the quarter before. In the last three months of the year, Tesla completed its acquisition of SolarCity as well as Grohmann Engineering, which will become Tesla Advanced Automation Germany.

In its investor letter, Tesla stated that it’s going into 2017 expecting to invest considerable resources in Model 3 development, which is still on track to begin this summer. This includes expanding the capabilities of Tesla’s mobile repair service so that roving bands of Tesla service people can do minor repairs at the owner’s home or office. Tesla is also anticipating a significant expansion of North American Supercharger stations, which the company hopes to double in 2017.

Interestingly, Tesla executives admitted on the investor call this afternoon that the company has been quietly rolling out an insurance package (with partnering insurance firms) to new Tesla owners, reasoning that if a Tesla is safer than other vehicles with Autopilot, then insurance should adapt accordingly. The company foresees eventually offering a maintenance and insurance package with its cars.