Tesla surprises with a profit in the third quarter

Tesla returned to profitability in the third quarter after two periods of losses, according to earnings reported after market closed Wednesday.

The automaker’s third-quarter results included revenue of $6.3 billion and earnings per share, adjusted of $1.86. Analysts had expected losses of 42 cents per share.

The third-quarter report sent Tesla shares as high as 17% in after market trading.

Tesla’s third-quarter was slightly lower than the $6.35 billion generated in the previous period and more than 7.5% lower than the same quarter last year. But it nearly in line with analysts expectations.

Tesla was also able to improve its automotive gross margins, an important sign of its financial health. The automotive gross margin widened to 22.8% in the third quarter from 18.9% in the previous period. The automotive gross margin has not yet recovered to the 25.8% of the same quarter in 2018.

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