Tesla stock surged by 20% on Thursday.
During afternoon trading on the New York Stock Exchange, Tesla’s stock price jumped by $44.68 (20.91%) from the previous day to $258.33.
This impressive increase followed the company’s unexpected quarterly earnings report. Released after the market closed the previous day, the quarterly earnings effectively mitigated the negative impact of the disappointing Robotaxi Day event.
Although quarterly revenue of $25.18 billion fell short of the market’s expectation of $25.37 billion, the 8% year-over-year increase satisfied investors.
In particular, the company’s ability to alleviate concerns about declining profitability significantly contributed to the stock’s performance.
Tesla’s third-quarter earnings per share (EPS) was $0.72, greatly exceeding analysts’ expectations of $0.58.
JP Morgan pointed out that while Tesla’s falling net profits had previously raised concerns among investors, this earnings report has eased those worries.
However, JP Morgan cautioned that Tesla’s increase in net profit margin to $739 million for the third quarter may not be sustainable in the long run.
Investors were enthusiastic about Elon Musk’s optimistic forecast.
Musk confidently asserted that in the best-case scenario, car sales growth could reach 20-30% next year, propelled by affordable vehicles and advancements in autonomous driving.
The company aims to reignite growth by launching the Model 2 and leveraging Full Self-Driving (FSD) technology.
Musk’s anticipated shipment growth rate of 20-30% significantly exceeds analysts’ projections of 15%.
Morgan Stanley predicts that the success of Musk’s plan will depend heavily on introducing the lower-priced Model 2, forecasting a shipment growth rate of approximately 14% for next year.
