Tesla Posts Record Q2 Profit, Announces New Texas Factory
Tesla beats analyst expectations with its fourth consecutive profitable quarter, paving the way for potential S&P 500 inclusion. CEO Elon Musk also reveals plans to build a new manufacturing plant near Austin, Texas.
Tesla reports a strong second quarter with earnings of $2.18 per share on $6.04 billion in revenue, easily beating analyst expectations. This marks the electric vehicle maker's fourth straight quarter of profits and its first full year of profitability on a GAAP basis, making it eligible for inclusion in the S&P 500 index. Following the news, Tesla shares jump more than 4% in after-hours trading.
On the earnings call, CEO Elon Musk announces that Tesla will build its next factory near Austin, Texas. The upcoming facility handles production of the Cybertruck, the Semi, and Model 3 and Model Y vehicles for the Eastern half of North America. Meanwhile, the existing Fremont, California plant focuses on Model S and Model X vehicles for all markets, along with Model 3 and Model Y production for the Western half of the continent.
Despite a 4% year-over-year decline in automotive revenue, Tesla benefits from a massive surge in regulatory credit sales, which nearly triple to $428 million. The company also recognizes $48 million in deferred revenue from its Full Self-Driving software package. Looking ahead, Tesla aims to achieve long-term profitability by reducing vehicle production costs and generating more recurring revenue through software updates.