Tesla is at a crossroads. For more than a decade, it lost money, teetering on the edge of bankruptcy, even as it made cars people loved. Now, Tesla has proven it can grow and make money at the same time, a new concept for the electric carmaker.
Tesla saw its stock surge after reporting the company’s third-consecutive profitable quarter (pdf), a first for the company that surprised analysts during its first quarterly earnings report on April 29. The news sent the stock up 9% in after-hours trading.
CEO Elon Musk told investors the company was pressing ahead with growth plans despite the Covid-19 pandemic: 500,000 cars per year, new autopilot features, the ramp-up of the Model Y crossover, and expanding factories in Berlin and Shanghai. Despite shutdowns that have slowed production and deliveries, Tesla managed to eke out a $16 million profit on $6 billion in sales. And while the coronavirus sent its free cash flow into negative territory this quarter, sales of the massively popular Model 3 and Model Y lines remain strong, and a recent fundraising round leaves the company with a comfortable cash pile.