SolarCity expects to contribute $1 billion or more in revenue to Tesla Motors next year after they complete their merger this month, the two companies told investors Tuesday.
Additionally, SolarCity expects to add more than $500 million in cash to Tesla’s balance sheet over three years, the companies said.
“That’s our forecast,” Lyndon Rive, chief executive of SolarCity, told investors during a joint conference call by the two companies. “When we install solar systems, we incur the cost immediately and immediately recognize the revenue.”
The call was part of a flurry of presentations in recent days that the sustainable energy firms have delivered to the public, including last week’s anticipated unveiling of glass solar shingles to replace the boxy panels that sit atop home roofs.
Elon Musk, Tesla’s chief executive and SolarCity’s chairman, who is known for his brassy marketing style, touted the creation of the world’s only integrated and sustainable energy company with a product he said should have hit the market long ago.
“We’re confident it can be very low cost,” he said.
When pressed further on their companies’ finances by investors on the call, Musk and Rive declined to discuss details, saying they would disclose more information during SolarCity’s upcoming earnings call.
The combination of Tesla and SolarCity will fold solar power generation, energy storage and electricity-driven cars into one package under homeowners’ roofs.
“It’s very unwieldy to do so as two separate companies,” Musk said.
Efraim Levy, an analyst at CFRA Research, questioned the financial sustainability of Musk’s operations.
“It looks like a lot of positive spin,” Levy said. “Elon Musk is literally changing the world and the way people look at energy and driving etcetera. But as for an investment in a stock?”
That’s not so clear, he said. “Adding cash in the short term doesn’t help you when you need cash down the line.”
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