Tesla cuts 7% of its workforce, and Elon Musk sees a 'very difficult' road ahead
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https://apple.news/AJzC1pj8gSk-lIVDLhBrqzA
"Tesla will need to make these cuts while increasing the Model 3 production rate and making many manufacturing engineering improvements in the coming months," Musk says.
The company discontinued the cheapest versions of its Model S sedans and Model X SUVs this week, and Musk says it will ditch its customer referral program.
Musk says Tesla faces "an extremely difficult challenge" in making its products a competitive alternative to traditional vehicles and energy products.
Q4 profit likely lower than Q3
In its last quarterly financial statement, Tesla posted its first profit in two years, reporting a net gain of $311.5 million and $881 million in free cash flow.
Musk said profit in the fourth quarter is likely to come in lower than in the previous quarter but added that he hopes Tesla will achieve a "tiny profit" in Q4.
"In Q4, preliminary, unaudited results indicate that we again made a GAAP [generally accepted accounting principles] profit, but less than Q3," Musk said. "This quarter, as with Q3, shipment of higher priced Model 3 variants (this time to Europe and Asia) will hopefully allow us, with great difficulty, effort and some luck, to target a tiny profit."
The company disappointed investors earlier this month after it announced it delivered a lower-than-expected 90,700 vehicles in the fourth quarter. That figure could foreshadow the company's fourth-quarter results, which it's due to release early next month.