Wednesday, Tesla released its Q3 earnings report. Despite the Wall Street consensus, that expected a loss of about $100 million, they were able to deliver a profit of just over $300 million. This was the first time in two years that Tesla turned a profit and the highest profit for the company ever. Let's look a bit deeper in the numbers.

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The record quarter in numbers

Here are some numbers to indicate how good the quarter was and how quickly Tesla is growing:

• Vehicle deliveries were at 83,800 (up 105% month-over-month and over 200% year-over-year)
• Automotive revenue went up to $6 bn (up 82% MoM and 158% YoY)
• Net income improved by more than $1 bn, from -$717 million to +$312 million

Outlook

Although the present looks pretty good already, the outlook might be even better.

M3 ramp up

Tesla expects to keep improving the Model 3 production process, leading to even higher production (and margins) in Q4 of this year. From 2019, the US federal tax credit for Tesla customers will be cut in half, so the demand for its cars there might reduce a bit.
Fortunately they have some other markets that they are going to start to serve with the Model 3 at that time. Europe is expected to be the first in Q1 of 2019 and Asia and the Pacific will follow in Q2. Taken into account that there is still a 400,000 reservation backlog for Model 3's, there is no reason to expect that Tesla can't sell all cars they produce within the blink of an eye.

Chinese Gigafactory

At the same time Tesla will start the construction of their factory in Shanghai, that will almost solely focus on the Chinese market. By doing so they can bypass the 40% import tariffs on US cars and make their cars more competitive to those of the Chinese manufacturers.

Model Y

Elon Musk also told in the earnings call that he had just approved the next vehicle that Tesla will produce, the crossover Model Y. The official release of the Model Y is expected to take place in March of 2019 and will most likely lead to M3-like numbers of reservations. Production should start in 2020.

All in all enough reasons to be positive about the years to come for Tesla.