Analysts and pundits have long doubted Tesla’s ability to turn a profit but the electric car maker has surprised everyone with its financial results for the third quarter. Wall Street was expecting Tesla to post a loss of $0.54 per share but instead the company posted a surprise earnings per share of $0.74. This amounts to a profit for Tesla on a GAAP basis. The company brought in $2.3 billion in revenue against analyst estimates of $1.98 billion. The market predictably responded in a positive manner with the company’s shares surging 5.5 percent after the results were announced.
“Furthermore, we expect this to continue into Q4 and project positive GAAP net income (excluding non-cash stock-based compensation) despite [Zero-emission vehicle] credit sales in Q4 likely being negligible,” Tesla said in a statement.
Tesla also said that it set new records for vehicle production, deliveries, and revenue in the third quarter which led to GAAP profitability and positive free cash flow. It added that gross profit per car has also increased substantially.
The company now expects to ship 50,000 vehicles in the second half of this year with 25,000 of these shipments being counted in the fourth quarter. Tesla says that it’s on track to deliver 500,000 cars in 2018.
The company is now working hard to get Model 3 on the production line, its first mass-market electric car is really what’s going to propel it from a niche player to a bonafide competitor in the auto industry.
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