Tesla Motors Inc (TSLA) SEC Filing 10-K Annual report for the fiscal year ending Wednesday, December 31, 2014

Earnings Press Release
10-K Annual Report
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Tesla, Inc.
Ticker: TSLA CIK: 1318605

Exhibit 99.1

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Tesla Motors – Fourth Quarter & Full Year 2014 Shareholder Letter

• Introduced All-Wheel Drive Dual Motor Model S & Autopilot in Q4

• Record quarterly production of 11,627 vehicles

• Delivered 9,834 vehicles, as P85D production delays pushed some to Q1

• Expanded Supercharger network to cover US coast to coast & most of Europe

• Expecting over 70% growth in vehicle deliveries in 2015

• Model X to begin shipping in six months

February 11, 2015

Dear Fellow Shareholders:

Tesla continues to drive the global transition to sustainable transport, with more pure electric car revenue than all other companies combined in 2014. From 2012 to 2014, Tesla non-GAAP revenue grew by almost 800% and GAAP revenue grew by almost 700% while gross margin simultaneously increased to unusually high levels by automotive standards. Moreover, as implied by the graph below, both vehicle production and demand are expected to accelerate in 2015.

In 2014, we also increased our number of stores and service centers by over 40%, expanded our Supercharger network by 400%, started construction of the Gigafactory and introduced numerous advances on Model S. As a result of this progress, we entered 2015 with over 10,000 orders for Model S and almost 20,000 reservations for Model X.

We built 11,627 vehicles in Q4, thus achieving our production target of 35,000 Model S vehicles in 2014. This required a herculean effort, because we held back release of our Performance All-Wheel Drive Dual Motor car (P85D) to ensure it would be a truly great experience for owners. While we were able to recover the lost production by end of the quarter, delivering those cars was physically impossible due to a combination of customers being on vacation, severe winter weather and shipping problems (with actual ships). As a result, about 1,400 vehicles slipped December and were delivered in Q1.

Our Q4 financials reflect this delivery shortfall, one-time manufacturing inefficiencies related to the introduction of P85D and Autopilot functionality, and the impact of the strong dollar. Even though the dollar has continued to strengthen by over 7% versus the euro in 2015, we believe we will be able to sustain a non-GAAP automotive gross margin of about 26% in Q1 by stabilizing production to improve manufacturing efficiencies. Without the sharp increase in dollar strength, Q1 gross margin would be about 28%. Tesla serves an international market and has a global supply chain, but most of the Model S is built in North America, so a strong dollar has a slightly negative net effect on profitability.

The following information was filed by Tesla, Inc. (TSLA) on Wednesday, February 11, 2015 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

View differences made from one year to another to evaluate Tesla, Inc.'s financial trajectory

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