Tesla posted a cash balance increase to $5.3 billion and reported a profit of $1.86 per share, shattering analyst expectations for a loss of 42 cents per share.
Tesla Inc on Wednesday surprised investors with a quarterly profit that sent its shares soaring, as Chief Executive Elon Musk promised a 2020 rollout of a cheaper SUV and more self-driving technology to stay ahead of larger rivals rushing into the premium electric vehicle market he created. Shares rose nearly 21% to $307.12 after hours on the unexpected news, crossing $300 for the first time since March 1 after record deliveries and cost cuts ensured a profitable third quarter.
The third-quarter results are an important milestone for Tesla and redemption for Musk who had to step down as chairman after a series of scandals and investor doubts about Tesla’s ability to withstand competition from larger, better capitalized global rivals.
Tesla’s gross margins, an important profit indicator for investors, surpassed expectations and Tesla said it was “highly confident” in exceeding the low end of its yearly global vehicle delivery goal.
But Tesla has yet to prove that it can be consistently profitable while managing the start of production for Model 3 sedans at its new factory in Shanghai and for Model Y sport utilities next year.
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