Tesla Inc (NASDAQ:TSLA) boss Elon Musk has hinted the company could go cap in hand to investors later on this year in a bid to drum up some more capital.
Musk said on an earnings call last night that the current business plan “could push it close to [the edge]” later on in the year, adding that a fundraise “probably makes sense…to reduce risk”.
The company’s share price has added more than 50% since its December lows despite no real news or catalysts, giving Musk the chance to replenish Tesla’s coffers.
“How close to the edge do we want to go? According to our financial plan, no capital needs to be raised for the Model 3, but we get very close to the edge,” said Musk.
“That’s probably not the best thing for shareholders on a risk-adjusted basis.”
His comments come ahead of a busy year for the US electric car maker.
Tesla has the launch of its first mass-market electric car, the Model 3, which remains on track for July, as well as the development of its massive battery plant or ‘Gigafactory’ as it’s otherwise known.
On top of all that, it’s got to try and oversee the integration of its recent Solar City acquisition.
The possibility of a capital raise comes as Tesla reported a narrower-than-expected loss in the final three months of 2016, while revenues rose more than Wall Street had forecast.
The company – which dropped ‘Motors’ from its name following the Solar City acquisition – reported a fourth quarter loss of US$121.3mln, or 78c a share, lower than the US$320.4mln, or US$2.44 a share, loss a year earlier.
Adjusting for a couple of one-offs, the loss of 69c a share was much slimmer than the US$1.13 analysts had forecast.
Revenues for the period almost doubled year-on-year to US$2.28bn to beat expectations, despite falling 1% from the previous quarter.
Tesla also revealed in a blog post that its chief financial officer, Jason Wheeler, is stepping down to “pursue opportunities in public policy”.
Wheeler’s departure after only a year or so in the job paves the way for Deepak Ahuja to return to his old post, having previously been CFO at Tesla for seven years before Wheeler’s arrival.
Shares gained more than 2% in pre-market trading to stand at US$279.31.