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Tesla Notches Another Quarterly Profit

Easily outperforms competitors amid the coronavirus pandemic
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Tesla sailed through the effects of the coronavirus pandemic in April-June to deliver its first four-quarter-long profit streak ever.

The company reports that it managed a mere 5% drop in quarterly unit sales year on year, easily outperforming virtually all competitors.

 

That was in spite of county health official orders that idled its home plant in Fremont, Calif., for the first six weeks of the quarter. The move prompted a frustrated CEO Elon Musk to huff that the company would “immediately” move its headquarters out of California (it didn’t).

Another Profit

Revenue from Tesla’s automotive operations slipped 4% to $5.2 billion year on year but grew 3% compared to the first quarter.

Net income in April-June swung to a $104 million profit from a $408 million loss in the second quarter last year.

Tesla says operating efficiencies and greater volume offset a decline in its average per-unit selling price as the company’s sale balance shifted sharply from pricey, low-volume Model S sedans and Model X crossovers to cheaper mass-market Model 3 sedans and Model Y crossovers.

Ambitious Targets

The bullish results pushed Tesla’s stock price from a record high $1,595 per share at Wednesday’s closing bell to a peak of $1,715 in after-hours trading.

Construction and rendering of Tesla’s Berlin factory (Image: Tesla)

Tesla also reports that it:

  • hiked global sales in the first half by 13% to 179,400 units.
  • aims to retail more than 500,000 vehicles worldwide this year.
  • will expand production capacity for Model 3 and Model Y cars 25% to 500,000 units by year-end at the Fremont plant.
  • expects to begin delivering the first of its Class 8 Semi truck tractors in 2021.
  • is finishing an adjoining plant at its 8-month-old factory in Shanghai to begin supplying Model Y crossovers to the Chinese market next year.
  • has begun above-ground construction at its Berlin factory. The facility is scheduled to open late next year with initial annual capacity to make 100,000 vehicles.