After posting strong third-quarter results, shares in American electric vehicle maker Tesla soared 17%—with the company’s market capitalization now sitting at a sky-high $53 billion USD.
The Elon Musk-led company’s stock market value is now higher than that of General Motors, which is valued at $51 billion, making it the most valuable American automaker. The company’s stock was trading at $299.68 when the markets closed Thursday night—with the company earning $1.91 a share in Q3.
Tesla over-delivered on Tesla’s promise to post a profit in Q3, turning in a net profit of $143 million and a pre-GAAP (generally accepted accounting principles) profit of $343 million.
“Q3 was obviously a very strong quarter and we had record deliveries, we’re able to make great strides and controlling our costs,” Musk said during the company’s Q3 earnings call. “We shifted back to GAAP profitability while also generating strong free cash flow. And again, this would not be possible without each employee doing their part to reduce cost. Our operating cost is now at the lowest level since Model 3 production started.”
Upcoming Tesla Model Y
Tesla will soon begin making cars in China as well, key to growing its sales in the world’s largest car market, which applies heavy tariffs on imported vehicles. The company’s first Chinese factory, located in Shanghai, started trial production this month, Musk said.
2021 Chevrolet Bolt EUV prototype
GM will be looking to capitalize on the perceived demand for electric vehicles that Tesla is currently enjoying when it releases its new line of BT1-based electric vehicles in coming years, which will include an electric GMC truck, an electric Hummer SUV and an electric Cadillac crossover. The automaker also plans to launch the new Bolt EUV electric crossover for the 2021 model year, which will do battle with Tesla’s upcoming compact electric crossover, the Model Y.
Tesla is also preparing an electric pickup truck, which the automaker is expected to debut before the end of the year. Musk previously said the truck would start at under $50,000, whereas the GMC electric truck is expected to be more expensive—potentially around $90,000.
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Source: Reuters
Comments
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revenues were down compared to a year ago but they cut costs and capital expenditures enough to eke out a profit and the shorts were squeezed.
but are those cost cuts temporary, delayed or something else? it is going to cost money to put their y and truck into production. it will be interesting to see how tesla(as well as gm) does without the federal tax credit.
i would think revenues would continue to decline in north america but perhaps china sales will give them a boost.
Good to see another US automaker up but this much value with a limited line-up?. The UAW will try to get into Tesla’s sauce….
My mother spotted a Model 3, one of the first sightings in my area, with the weird misshapen black rims and said- “what is that ugly thing parked over there”? And she knows nothing about cars other than a few distinct ones. And she rarely ever comments on things like styling.
Hhhhhhhm. Have I been here stating that Tesla does indeed make profits from EV vehicles and some have been unwilling to accept facts here?
Great job by the Tesla team. As stated multiple times by me…NEVER Bet against a man who made Rockets land and reusable. I love that an American Startup Company single handedly changed a whole Industry, Because of Tesla, an American Company will be in the Lead in the EV Future. As I have been stating here for years, Tesla has no doubt secured their so called “Apple” Top position in the Marketplace. Other Automakers are years behind them now.
Like I have been stating I just hope GM has the Guts to grab the coveted second place which is the “Google” spot. But as of right now VW is killing GM. Hopefully GM gets serious and takes the Second Spot from VW. Remember Apple is the lead Company but doesn’t mean they sell more than Android phones. My point is that other Companies will eventually sell more Vehicles than Tesla but will never be able to grab the “Apple” position in the Marketplace. That is solidified in people’s minds now as has Apple.
Again, great job Tesla. A great American Company. And they are ONLY JUST Starting!!!
they made a profit for a quarter, not a year otherwise their stock price wouldn’t have dropped from 400+ to 300.
less than one year ago, they had to raise more capital because musk’s claims of “self-financing” proved false. he wasn’t making enough money from operations to support the business.
You’re completely missing the point. Tesla is NOT just a Car company.
Their vehicles make a Profit. That was the issue at hand. Some here and some auto analysts that DO NOT want to admit that Tesla changed the Auto Industry completely around have thought for whatever reason that Tesla vehicles lose money. Which obviously is NOT the case.
The reason why the Company made a profit this Quarter is their Solar division jumped by over 40% in sales. Their Backup Battery Packs have always been consistent. Tesla spends a lot of Money on their R&D….A lot
tesla made EVs cool. they didn’t make them profitable unless you count one quarter out of four your measuring stick.
doesn’t everyone spend on r&d. do they spend more than gm? how about toyota or honda? what about the germans and koreans?
i guarantee you the solar division didn’t push them into profitability. a reduction in capex did. revenues declined YOY. for a high growth company, declining revenues is the last thing you want to hear. but china sales is on the horizon unless chairman xi orders everyone to support chinese EVs.
why don’t you add some absolute numbers to that supposed 40%. as we all know, percentages are deceiving especially if you are starting from a low base.
Tesla may have great engineering for EVs only, but GM has the world’s best engineers for the entire line, gas or electric. And what happened to Tesla multi-billion debt? Did it disappear by magic or sent to space by one of Musk rockets?
@Raymond Ramirez
What Debt are you talking about?
Tesla has over Five Billion Dollars Cash Flow. Also the China Gigafactory is about to start Producing real soon.
So yeah no debt.
tesla’s free cash flow for the quarter was about $350M. if you are foolish enough to extrapolate that over a year, that is $1BN. where did you pull this $5BN from? same place that told you tesla has no debt?
Maybe a little research is in order. There is so much FUD stories out there about Tesla. I am floored that we here in America are against Tesla instead of cheering them on.
Profits and Cash on hand are two different things.
Tesla actually has 5.3 Billion On hand. Most they have ever had. They are NOT in Debt.
Now when Tesla becomes Cash Positive consistently, they will continue to Grow that 5.3 Billion Fund.
so if i have $100 in the bank but i owe $5000 on a car loan, i’m not in debt?
Again Tesla does not owe money. They have 5.3 Billion in the Bank. They also have almost half a Billion in a different Account that they cannot touch which is all the money that customers have paid them for Full Self Driving. Every time they introduce new FSD Features like they did this last Quarter, they are allowed by law to grab some of that money. They are averaging about 30-50 Million draw from that account per year. Give or take.
Now I hope everyone realizes that the FSD Account continues to grow and will soon be about a Billion Dollars or so the more Cars they sell as they have been. The Gigafactory in China will probably be producing 300-500 Thousand vehicles per year if not more by the time it is Fully Staffed. Tesla has ZERO Cash issues at all. A a matter of fact, they will be making so much money in a couple of years that people will be blown away. Once again, TESLA IS NOT JUST A CAR COMPANY.
They are an Energy Company
A Car Company
Battery Backup Storage Company
Super Chargers
Semi Truck Maker (Soon)
A Battery Company (Soon)
Robotaxis (Soon)
Their means of getting money is so wide. Most people just do not realize.
I will state yet once again a crazy stat that will put Teslas dominance in perspective.
Tesla has over 13 Billion (Yup Billion) Real World Autonomous Driven Miles of Data. The second closest is Googles Waymo which is a little over 12 Million Miles of driven Data. Oh and Waymo Miles are in Geofenced areas. GM Cruise is I believe in Fourth Place just behind Uber. So who do you think will win the Autonomous Prize?
Tesla will be worth so much money it will be insane. I am pulling for them as we would have another Great American Company!!!
“Tesla is also preparing an electric pickup truck, which the automaker is expected to debut before the end of the year. Musk previously said the truck would start at under $50,000, whereas the GMC electric truck is expected to be more expensive – potentially around $90,000.”
This is more of Musk’s false statements as he did for the Model 3. I bet that the Tesla truck will not be below $50,000 until they sell millions of other more expensive versions first, and that will be beyond 2021. Ford’s EV truck will sell sooner and cheaper.
@Ford Owner
What False Statements from Elon are you referring too exactly?
Are you talking about timelines for Product?
Maybe so for the short term, but the man stay in value is R&D, marketing prowess, market access, and brand loyalty. In comparison, GM is a better bet.
@DancingHail
In my opinion GM is as Big as they will get. Give or take a little bit obviously. But Tesla has the Potential to become literally one of the biggest Companies in the World. Not Auto Companies but overall Companies.
A lot of CEO’s took Tesla way too lightly and now are paying the price for it. I really liked Bob Lutz a lot but even he is eating some major Crow right now. Elon showed him and everyone in the Auto Industry they were wrong and he was correct. Now all major Auto Makers are in a Break Neck speed to figure out EV’s going forward. VW figured it out earlier and are now in second place. Hopefully GM will come on strong and overtake VW but it is not looking good at all as of right now.
Hope they prove me wrong though as a GM fan.
Side note, I am really excited to see Hummer return as a Premium EV Offroad Brand. Might make too much sense for GM to actually go through with it though LOL
Maybe so, but cash flow matters and Tesla has a dismal record to date. Equity growth based on leaps of faith and technological achievements can only last so long before the cookie crumbles. In addition, other companies aren’t just sitting idle. Don’t underestimate GM. Look at the C8, surprise. Also, GM’s R&D in their electric vehicle architecture will be a leading-edge front. GM is a mature company whereas Tesla is fairly new requiring it to invest heavily for growth. At least GM could be considered a safer bet.
@DancingHall
I am a huge GM fan obviously. I have been on this site for like ever.
I am not underestimating GM at all. I have been here for years shouting that I hope GM prevails to be the Google to Teslas Apple. Now please realize that is only meant in the thinking of the General Public between the two companies. Meaning that yes Google sells waaaaaaay more Android devices but most folks consider Apple to be the Absolute Best and nothing ever compares.
Having said all that, GM is mostly only a Car Maker now. They do have Cruise as well. But they are tiny as of right now. And I actually think Cruise might become worth more than GM itself.
Tesla is way more than that. That was my point.
They already have a Positive 5.3 Billion sitting in a Bank and then almost Half a Billion in another account that they cannot touch as of yet. The Gigafactory will be basically printing money for Tesla in China. Remember they will not have to pay the Tariffs anymore going forward.
Tesla Energy might turn out to just as big or maybe even bigger than Tesla Automotive. Then you will have Cybertaxi Service. The cash flow stream might get absolutely ludicrous for Tesla. Time will tell.
If you don’t listen to the Short Sellers which Got decimated this Quarter (and the others are Big Oil) Tesla has the Potential to become one of the biggest Companies in the World. Not just Car companies. If you believe in Elon I guess Tesla is the safest Bet. If you absolutely do not believe in Elon, then yes GM is a safer bet.
Time will show which side will be correct. My point has always been that I cannot go against or not believe a man that 10 years ago told the World he will land and reuse Rockets and even the Great minds at NASA laughed at him. Are they laughing at Space X now? Yeah I do not think they are.
I pray GM is working on the Technology that will keep them in business for the next 100 years and then some.
Both Tesla and GM will do well in the future, they have the technology and top selling vehicles in the EV market, and there is enough demand for both to co-exist. It’s Toyota and FCA that need to be worried if EV’s take off, because they have no experience producing high quality or affordable EV’s.