Tesla notes back-to-back profitable quarters for the first time ever.
In its just-released Q4 earnings reports, Tesla again shows a profit, though it’s not as high as in Q3. Regardless, a profit is a profit and Tesla has proven to the world that it can indeed make money.
Tesla said it earned $139 million, or 78 cents a share, in the quarter, impacted by a $54 million non-cash charge, versus a loss of $4.01 a share in the year-ago quarter.
Adjusted for one-time items, Tesla earned $1.93 a share, versus a $3.04 loss a year ago. Revenue rose to $7.23 billion, compared with $3.29 billion a year ago.
That profit of 78 cents per share is a solid figure, though the big Q3 profit was way higher at $2.90 per share. However, Q3 was always expected to be a bigger profit quarter for Tesla, so there’s no miss here.
Tesla Model 3
The Model 3 is the primary focus of late. On this front, Tesla states:
Model 3’s production rate progressively improved through Q4, with December 2018 being our highest volume month ever. In ourFremont facility, we are now past the steep portion of the production S-curve, and we expect our production rate to continue to gradually improve. Every part of the Model 3 production process has demonstrated over a 24-hour period the ability to produce at an extrapolated rate of 7,000 vehicles per week. By the end of this year, we expect to be able to produce Model 3 at this rate on a sustained basis.
As we improve the production rate of Model 3, the cost per vehicle continues to decline. It is critical that we continue this trend so that we can keep increasing the affordability of Model 3 while retaining a sustainable level of profitability. The labor hours per Model 3 vehicle declined yet again by roughly 20% compared to Q3 and by about 65% in the second half of 2018 alone. Despite introducing a lower-priced mid-range variant and other headwinds, Model 3’s gross margin remained stable in Q4 at over 20%.
You’ll find Tesla’s release in its entirety below: