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SolarCity Corp., which is in the process of being acquired by fellow Elon Musk company Tesla Motors Inc., reported a wider quarterly loss Tuesday as operating expenses climbed sharply.

For the current quarter, the home solar company forecast an adjusted loss between $2.55 a share and $2.65 a share, worse than estimated by analysts surveyed by Thomson Reuters, who forecast a loss of $2.26.

For the latest quarter, SolarCity reported a loss of $250.3 million, or 56 cents a share, compared with $155.7 million, or 23 cents a share, a year earlier. The quarter's adjusted loss was $2.32 a share, better than analysts' predictions of $2.44 a share.

Revenue rose 81% to $185.8 million, far above analysts' expectations of $146 million.

The company reported that revenue from periodic billings more than doubled from a year earlier, hitting $141.1 million. Total operating expenses, which includes some $29 million linked to restructuring expenses, rose to $265.4 million from $175.8 million during the same period a year earlier.

Shares of the company, tied to the Tesla offer price, barely budged after hours, rising 0.2% to $24.60. Shares of the company have been down some 53% over the past 12 months.

SolarCity, the largest home solar company in the U.S. by rooftop installations, has been in the spotlight since Tesla Motors offered in June to buy it.

Tesla's offer for the San Mateo, Calif.-based solar-panel installer raised eyebrows because Mr. Musk, who is chief executive of Palo Alto, Calif.-based Tesla, is chairman of both companies' boards of directors and a cousin of SolarCity CEO Lyndon Rive and Peter Rive, the company's chief technology officer.

Mr. Musk and Mr. Rive want to combine the firms into a single integrated sustainable energy company that harnesses sun power from home roof arrays and channels it into energizing electric cars in the garage, and additional batteries that can store the power for later use.

Opponents of the deal say that Mr. Musk, who owns more than 20% of each company, has an outsize influence that could create a conflict of interest. Some analysts have called Tesla's purchase a bailout for SolarCity; the panel-maker's share price has fallen by more than half so far this year.

Tesla's deal to buy SolarCity using stock was valued at $2.6 billion when it was announced, considerably lower than its original proposal. The lower purchase price prompted questions from investors about whether the outlook for SolarCity's business—or the residential solar market in general—is cooling off.

Mr. Musk told investors on a conference call Tuesday afternoon that the lower price for SolarCity is what independent board members of both companies came up with "in an exhaustive discussion that lasted a week or two."

"I haven't inquired about the details and I'm not privy to the details, but it's what they concluded is fair, between independent board members of SolarCity and board members of Tesla," he said.

If shareholders approve the deal, the companies could combine by the end of this year.

Using batteries to store electricity at homes and businesses is key to developing more solar power. The market for so-called stationary energy storage is currently tiny, but some analysts and clean-energy companies are forecasting that demand for batteries to store electricity will grow, proving integral to putting more wind and solar power on the grid and a cheaper alternative to conventional utility equipment.

SolarCity is likely to pair batteries with most solar panels it installs by 2020, as demand for storage increases as a way to balance out the flow of electricity between buildings with panels and local power grids, the company said.

"Solar and batteries go together like peanut butter and jelly," Mr. Musk said. "If you don't have the batteries there to balance the grid and buffer the power, you really cannot go beyond a certain level of solar in a particular neighborhood."

Write to Cassandra Sweet at cassandra.sweet@wsj.com and Ezequiel Minaya at ezequiel.minaya@wsj.com

(END) Dow Jones Newswires

August 09, 2016 19:25 ET (23:25 GMT)

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