Tesla posts record revenue of $8.77billion in the third quarter - putting the carmaker on track for its first-ever profitable year
Tesla raked in a record revenue of nearly $8.8billion in the third quarter - crushing analyst estimates and putting the firm on track for its first-ever profitable year despite a slump across the wider auto industry.
The electric carmaker reported a net income of $331million, or 27 cents per share, for the months from July to September on Wednesday - marking its fifth-straight profitable quarter.
Excluding special items such as stock-based compensation, Tesla made 76 cents per share, beating Wall Street estimates of 57 cents. Third-quarter revenue was $8.77billion, also passing analysts' expectations of $6.3billion, according to FactSet.
The earnings were driven by a 44 percent increase in global deliveries for the quarter, which came as US auto sales overall fell 9.7 percent from a year ago due to consumer fears about the economy hit hard by the pandemic.
Tesla posted a record revenue of $8.77billion in the third quarter on Wednesday - crushing analyst estimates and putting the firm on track for its first-ever profitable year (file photo)
Shares of the company were up 2.9 percent in extended trading Wednesday when its results were released after the markets closed. Shares are up about 400 percent from the start of the year.
At $394.5billion, Tesla's market capitalization is the largest among all automakers in the world, despite Tesla trailing rivals in terms of sales, revenue and profit.
The company has enjoyed a meteoric rise under CEO Elon Musk, who tends to be outspoken and at times unconventional.
Tesla's ascent highlights investor confidence about the future of electric vehicles and Tesla's shift from niche carmaker to global leader in clean cars.
The third-quarter profit was more than double the same period a year ago, when Tesla made $143million. Its string of profitable quarters reversed years of losses.
Through the first nine months of this year, Tesla has made $451million and appears headed toward its first annual profit.
As in previous quarters, the company may have lost money in the third if it weren't for $397million it earned from selling electric vehicle credits to other automakers so they can meet government fuel economy and pollution regulations.
Tesla shares were up 2.9 percent in extended trading Wednesday when its results were released after the markets closed. Shares are up about 400 percent from the start of the year
In the months from July to September, revenue from the sale of regulatory credits accounted for five percent of Tesla's overall automotive revenue.
So far this year, regulatory credits account for $1.18billion, or seven percent of total automotive revenue.
Pollution credits became a more meaningful source of revenue for Tesla about a year ago when California and about a dozen other US states began increasing the mandatory share of zero-emission vehicles per manufacturer sold in their states.
But that revenue is expected to dry up as Tesla's competitors begin selling more electric vehicle models of their own.
Tesla on Wednesday said it saw growing interest in its cars.
With recovery in the United States sluggish and Europe struggling with a second bout of the virus outbreak, some analysts have pinned their hopes for Tesla on growth on China.
In a letter to investors Wednesday, Tesla said it still is on target to deliver a half-million vehicles this year, something promised earlier by CEO Elon Musk
On October 2, Tesla reported that it had delivered 139,000 SUVs and sedans from July through September, compared with 97,000 deliveries during the same period a year ago.
Analysts said China, where the economy is recovering, was a major source of sales for Tesla.
Tesla does not break out regional sales, but data from China's auto industry association, CPCA, showed Tesla Model 3 sedan sales remained roughly flat from July to September.
Overall, Tesla sold around 34,100 Shanghai-made Model 3s in the third quarter.
In a letter to investors Wednesday, Tesla said it still is on target to deliver a half-million vehicles this year, something promised earlier by Musk.
The company said hitting the target 'has become more difficult' and depends on increases in production of the Model Y small SUV and at the company's plant in China.
Tesla said it should have sufficient cash to fund its future products, which include the Cybertruck pickup and a Semi, as well as its long-term expansion plan.
Tesla is adding Model Y production capacity at its Shanghai plant and is building new factories in Germany and near Austin, Texas, to keep up with demand.
Deliveries from the new factories are planned for next year, the company said.