Tesla shares soar on earnings surprise

Scott Martin | USA TODAY

Tesla Motors shares put the pedal to the metal on Wednesday in after-hours trading following results that show the company's revenue is growing better than forecasts and profit that blew past expectations.

Shares of Tesla jumped 14% to $153.20 in trading after it reported results. Year to date, the stock has soared 300%.

The auto maker, led by founder Elon Musk, reported net income of $26.3 million, excluding one-time items, that handily beat expectations for a loss of $18.9 million. That comes after it posted its first profit ever in its previous quarter, defying skeptics that it could become profitable.

Tesla delivered earnings per share of 20 cents, ahead of forecasts for a loss of 19 cent per share.

Revenue came in ahead of expectations, at $401.5 million, suggesting the auto maker's growth plans are on track.

CEO Musk, founder and chairman of SolarCity as well as CEO of SpaceX, has grabbed the auto industry's attention with his focus on on-board computing in Tesla cars and advances in battery technologies.

"The automaker's long-term goal of producing a high-volume, low-cost electric car is the next big hurdle, but for now they seem to be firing on all non-existent cylinders," says Kelley Blue Book analyst Karl Brauer, .

Musk also has ambitious plans for building out Tesla's network of charging stations with plans to expand nationwide by 2015. If that weren't enough, the busy CEO is developing robotic battery-changing prototype stations that could get cars in and out in minutes for about $50. The other option is a fast-charging wait for a charge that is free at Tesla's growing network.

Tesla watchers were fine-tuned to its earnings report for any signs of the auto maker's advances on these fronts or slips in expectations. The auto industry will continue to be watching its unit sales to gauge its growth and whether its risky bet on a charging network is proving possible on such a time table. Investors are also closely watching Tesla's guidance on its premium-targeted gross margins.

"We feel pretty confident about the 25% number," said Musk on a conference call of the company's progress toward the target.

Analysts had predicted the auto maker would report sales of 5,000 cars in the quarter. "I think they'll come in higher by about 10%," says Ben Kallo, analyst with Robert W. Baird & Co.

Tesla beat expectations on its closely watched number of cars delivered, with 5,150 cars moved for the quarter.

"We improved our production rate by 25% from 400 to almost 500 vehicles per week," Tesla said in its earnings statement.

Tesla was expected to report a loss of $18.9 million in net income compared with a loss of $93.2 million in the same period a year ago, according to the survey of estimates from Thomson Reuters.

Analysts were bracing for Tesla to report a revenue slide in the quarter. Analysts expected second-quarter revenue of $383.4 million -- way up from the $26.65 a year ago -- compared with the previous quarter's $561.8 million in revenue.

Contributing: Jayne O'Donnell