Tesla jumps 6% on stronger than expected quarterly results

Tesla Inc. (NASDAQ: TSLA) published its quarterly financial results on Wednesday that topped the analysts’ estimates for earnings and revenue. The company remained profitable in four consecutive quarters that now makes it eligible to secure a spot in the benchmark S&P 500 index.

Shares of the company were reported about 6% up in extended trading on Wednesday. At £1,318 per share, Tesla is nearly 300% up year to date in the stock market after recovering from a low of £284 per share in March when the impact of COVID-19 was at its peak. Learn more about how can you start trading on the stock market.

Tesla’s Q2 financial results versus analysts’ estimates

According to Refinitiv, experts had forecast the company to print £4.22 billion in revenue in the second quarter. In terms of earnings per share (EPS), they had estimated 2.35 pence per share. In its report on Wednesday, Tesla topped both estimates posting a higher £4.74 billion in revenue and £1.71 of adjusted earnings per share in Q2.

The U.S. electric car manufacturer recorded its net income (GAAP) in the second quarter at £81.63 million. Last week, a German court ruled Tesla’s autopilot feature as misleading.

At £4.07 billion, Tesla’s revenue from its automotive segment came in 4% lower on a year over year basis despite the addition of Model Y crossover SUV to its offerings and the launch of a new production facility in Shanghai last year.

The San Carlos-based company reported an unprecedented jump in its regulatory credits revenue from £87.28 million last year to £335.95 million in the second quarter. Tesla also said that it produced and delivered more than expected vehicles in Q2, despite the COVID-19 and civil rights protests driven disruptions in recent months.

Tesla slashed its spending on research and development in Q2

Tesla is committed to establishing a new factory in the U.S. before the start of 2021. It has also excited its customers and shareholders about the launch of its futuristic Cybertruck, a million-mile battery, and a Tesla Semi all-electric by the end of this year. Incidentally, find out how to become a Tesla shareholder in this guide.

Amidst the ongoing Coronavirus pandemic, however, Tesla slashed its spending on research and development from £254 million last year to £219 million in the second quarter.

Tesla also performed largely upbeat in the stock market last year with an annual gain of roughly 35%. At the time of writing, the American electric vehicle and alternative energy company has a market capitalisation of £231.69 billion.