Tesla’s eye-popping stock surge is starting to look like the real deal.
All eyes were on Elon Musk’s electric automaker on Wednesday as the company reported fourth-quarter earnings on the heels of a recent 130-percent stock surge. Investors — and Musk’s small army of short sellers — were desperate to see if the South Africa-born billionaire could keep the party going.
He did not disappoint his investors — although Tesla’s short sellers are likely howling in pain.
Tesla’s stock soared more than 12 percent in extended trading as the company reported its second-consecutive profitable quarter and said that production of its Model Y compact SUV has begun “ahead of schedule.” The company had previously said production would begin in the summer.
Tesla also said it will begin to produce “limited volumes” of the Tesla Semi truck this year, it said.
The car maker reported adjusted earnings per share of $2.14, outpacing the $1.72 that Wall Street was looking for. It also hauled in $7.38 billion in revenue compared to the $7.02 that was forecasted.
After hours on Wednesday, shares jumped up to $649.27. The stock was trading around $308 at the same point last year.
The Palo Alto, Calif.-based Tesla, which has been dogged over questions of sustained profitability, said it expects “positive quarterly free cash flow” and “positive net income” going forward, save for “temporary exceptions” around the launch and ramp of new products. The company “has grown to the point of being self-funded,” it said.
The company said that “further cost efficiencies should allow Tesla to ultimately reach an industry-leading operating margin,” and said that it will “comfortably exceed” 500,000 vehicle deliveries in 2020.
Tesla earlier this month said that it delivered 112,000 vehicles in the fourth quarter of 2019 where Wall Street was expecting 106,000.
Operating expenses rose less than one percent to $1.03 billion, and Tesla said that its cash balance has increased to $6.3 billion.
Tesla last week surpassed the $100 billion market cap for the first time, and is now the second most valuable automaker in the world, trailing only Japanese juggernaut Toyota.
