In its Q3 financial report released on 25 October, Tesla made good of Elon Musk’s profitability promises by posting a net income of US$311.5mn
In the report, Tesla celebrated “a truly historic quarter”, reaffirmed that it would achieve positive GAAP net income over Q4, and made special mention of the success of its Model 3.
“Model 3 was the best-selling car in the US in terms of revenue and the 5th best-selling car in terms of volume,” the statement said. “Model 3 is attracting customers of both premium and non-premium brands, making it a truly mainstream product.”
According to CNBC, Musk told investors that the Model 3 is accruing orders of “anywhere from 500,000 to 1 million cars a year.”
Prior to Q3 2018, Tesla has only had two profitable quarters since going public in 2010, and Musk’s affirmations of profitability by the end of 2018 had been met with deep scrutiny.
CNBC added that Tesla’s share price had risen by 12% following publication of its financial results.
Tesla’s Q3 report closed by saying:
“Sufficient Model 3 profitability was critical to make our business sustainable – something many argued would be impossible to achieve.
“Due to the ingenuity and incredible hard work of our team combined with an innovative vehicle design and manufacturing strategy, we have achieved total auto gross margin of ~25%.”