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October 22, 2021

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Tesla hits a record profit in 3rd quarter

Record electric vehicle sales last summer amid a shortage of computer chips and other materials propelled Tesla Inc to the biggest quarterly net earnings in its history.

The company said on Wednesday that it made US$1.62 billion in the third quarter, beating the old record of US$1.14 billion set in the second quarter of this year. The profit was nearly five times larger than the US$331 million Tesla made in the same quarter a year ago.

Revenue of US$13.76 billion from July through September also set a record, but it fell short of Wall Street expectations of just over US$14 billion, according to FactSet.

Excluding special items such as stock-based compensation, Palo Alto, California-based Tesla made US$1.86 per share, beating analyst estimates of US$1.62. CEO Elon Musk has said he’s moving the headquarters to Austin, Texas, the dateline of Wednesday’s earnings release.

Some of the quarterly profit, though, came from selling regulatory credits to other automakers. Tesla made US$279 million on credits during the quarter.

Many challenges

“A variety of challenges, including semiconductor shortages, congestion at ports and rolling blackouts, have been impacting our ability to keep factories running at full speed,” the company said in a statement to shareholders.

Earlier this month Tesla said it delivered a record 241,300 electric vehicles in the third quarter even as it wrestled with the shortages that have hit the entire auto industry. Most automakers reported sales declines in the US last quarter due to chip and other shortages, including General Motors and Ford.

Previously, Musk has said Tesla kept its manufacturing lines running largely by finding chips from alternate suppliers and then scrambling to rewrite some of the software in its cars to ensure all the technology remained compatible.

Third-quarter sales rose 72 percent over the 140,000 deliveries Tesla made for the same period a year ago. This year, Tesla has sold around 627,300 vehicles — compared with last year’s total of 499,550.


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