- Tesla stock jumped 4% on Thursday after the EV manufacturer reported record Q3 revenue and profits.
- The company saw revenue surge 57% to $13.8 billion in the third quarter, beating estimates.
- Tesla's gross margin also impressed analysts and showed the company's resilience to recent supply-chain constraints.
Tesla stock reversed early morning losses and jumped as much as 4% on Thursday after the electric vehicle manufacturer posted record revenue and profits in its third-quarter earnings report.
Despite ongoing supply-chain bottlenecks, especially related to chips that are prevalent in Tesla's vehicles, the company was able to beat analyst estimates and deliver a record number of vehicles in the quarter.
"A variety of challenges, including semiconductor shortages, congestion at ports and rolling blackouts, have been impacting our ability to keep factories running at full speed," Tesla said, implying that the company would have been able to produce more vehicles if not for the supply-chain disruptions.
Here are the key numbers:
Revenue: $13.76 billion, versus analyst estimates of $13.16 billion
Adjusted earnings per share: $1.80, versus analyst estimates of $1.61
Automotive gross margin: 30.5%, versus analyst estimates of 28.4%
A 57% year-over-year surge in revenue growth was driven by a record 241,391 vehicles delivered in the quarter. And even when excluding Tesla's sale of regulatory credits, its adjusted automotive gross margin of 28.8% still managed to beat analyst estimates by 0.4 percentage point.
The company said it continues to make progress towards producing Model Y vehicles at its Berlin and Austin manufacturing plants before the end of the year, and that it continues to expect average annual growth of 50% in its vehicle deliveries. Meanwhile, deliveries of Tesla's Cybertruck are expected to begin by the end of 2022.
Bank of America was impressed with Tesla's results and raised its price target on the stock to $1,000 from $900, but said its sky-high valuation remained a potential hurdle for further gains.
"Despite the arguably encouraging 3Q results and Tesla's continued execution, we have trepidation that Tesla stock may already be priced to perfection (or at least priced for hyperbolic growth), such that near-term earnings beats may be insufficient to get bulls incrementally positive on the stock," the bank said in a Thursday note.
Tesla's surge on Thursday to an intraday high of $900.00 put the stock within striking distance of its record $900.40 high reached earlier this year.
