Tesla tycoon Elon Musk’s testy relationship with Wall Street found firmer ground today as the car-maker stunned investors with a swing into profit.
The Californian technology company posted its first quarterly profit in nine months, with earnings of $143 million (£111 million) between July and September compared with a $1.1 billion loss in the first half of the year.
The figures, only Tesla’s fifth quarterly profit in its 16-year history, spurred the shares, up 17% to $299. That was despite first-quarterly fall in revenue growth since 2012. Profits were aided by “cost control”.
Musk has a tetchy relationship with Wall Street, where trust in him has been eroded by missed production targets, tweeting market-sensitive information and a video last year of him smoking marijuana.Tesla, which is building a huge new factory in Shanghai to ramp up production, is aiming to make its electric vehicles affordable, but its cheapest model is £39,000.
Nevertheless the car-maker has built an army of loyal fans and its Model 3 car was the UK’s third-best-selling car in August. It has begun testing its new Model Y.
London Capital Group analyst Ipek Ozkardeskaya said: “Tesla’s positive revenue announcement was a shocker that no one anticipated.”
On a busy day for the automotive industry:
- Nissan is weighing up whether to sell its plants in the UK and Spain as its market share in Europe declines, Bloomberg reported.
- Former Nissan boss Carlos Ghosn’s lawyers have asked a court in Tokyo to dismiss all the charges against him. Lawyers for Ghosn, currentlyout on bail, accuse the Japanese government of conspiring against him.
- Volvo Cars warned its margins had been squeezed as a slowdown in the car industry and the US-China trade war bites.
- South Korea’s Hyundai missed third-quarter profit forecasts amid sluggish sales in China.
