Tesla Delivers a Surprise Profit on Strong Cost Control
Tesla (NASDAQ: TSLA) surged into profitability in the second half of 2018, buoyed by rising deliveries of its Model 3 midsize sedan. However, the company plunged back into the red in the first two quarters of 2019, even though it achieved a new delivery record in Q2. Price cuts and unfavorable mix shifts from the pricey Model S and Model X toward the Model 3 -- especially cheaper versions of the Model 3 -- drove this profit reversal in the face of record volume.
Tesla hit a new delivery record last quarter, but it just barely surpassed its Q2 delivery total. This made it seem like another quarterly loss was in the cards. Instead, Tesla surprised investors with a solid profit for Q3, driven by significant cost reductions.
Tesla generated $6.3 billion of revenue last quarter, roughly in line with analysts' expectations. This was down slightly from the second quarter and down 7.6% from $6.8 billion in the prior-year period.
Source Fool.com
