Swedish electric-vehicle maker Polestar said Friday that its third-quarter operating loss narrowed from a 12 months ago as revenue greater than doubled, and it confirmed that it still expects to deliver 50,000 vehicles in 2022.
But the corporate warned that higher costs and supply-chain issues will proceed to squeeze its margins into 2023.
Listed below are the important thing numbers from Polestar’s third-quarter earnings report, its first as a public company following its merger with a special-purpose acquisition company in June.
- Revenue: $435.4 million, versus $212.9 million within the third quarter of 2021
- Operating loss: $196.4 million, down from $292.9 million a 12 months ago
Despite the operating loss, Polestar was in a position to report a net profit of $299.4 million, or 14 cents per share, because of an accounting credit related to the revaluation of future share payouts. (Because Polestar’s share price has fallen because it went public, it should should pay out lower than it had previously expected, hence the credit.)
Shares rose sharply after the report and ended Friday’s session up over 20%.
“I would really like to reiterate: Polestar is an actual automobile company,” CEO Thomas Ingenlath said through the earnings call. “We’re putting cars on the road today and we’re delivering on our ambitious growth plan.”
CFO Johan Malmqvist said that Polestar’s lower operating loss was helped by its efforts to cut back costs, specifically short-term reductions in promoting and marketing spending. Then again, foreign exchange headwinds exacerbated the loss, and people are expected to proceed into next 12 months.
“As our cars are produced in China, the vast majority of our costs are in renminbi, which has strengthened against European currencies, resulting in the next cost of sale,” Malmqvist said through the earnings call.
Malmqvist said that Polestar still expects to deliver 50,000 vehicles in 2022, generating about $2.4 billion in revenue for the total 12 months, each in step with its prior guidance. Those numbers imply deliveries of about 19,600 vehicles within the fourth quarter, producing about $924 million in revenue – and people vehicles are already built and in transit to customers now, he said.
Polestar ended the third quarter with about $988 million in money, and it has since secured a $1.6 billion credit line from its two principal owners, Volvo Cars and Chinese automaker Geely. That is enough to fund the corporate through 2023, Malmqvist said.