Tesla stock surges as Musk looks to make good with analysts

Tesla is now the king of the mid-range cars

Electric auto maker Tesla achieved its goal of producing 5,000 Model 3 vehicles per week by the end of its second quarter in June, but saw its biggest net loss to date.

Mr Musk said he remained confident of delivering on the promise of turning a profit in the second half of the year: "Our goal is to be profitable and cash-flow positive for every quarter going forward".

Tesla shares were up 5 percent at $316.45 in after-market trading on Wednesday. While it's no secret that the Model 3 ramp-up got off to a much slower start than Tesla initially promised, the company during the last week of June did manage to boost Model 3 production up to 5,000 units/week.

Tesla Inc. (TSLA.O) burned through less cash than analysts' expected last quarter and stood firm with Chief Executive Officer Elon Musk's projection that profit is around the corner after years of losses. On an adjusted basis, Tesla lost $3.06 per share, missing the consensus estimate of $2.92. The call triggered a stock sell-off and raised questions about Musk's behavior. That's substantially less than the 2017 level of $3.4 billion.

Tesla is continuing its elusive search for overall profitability, as it reported a loss of USD 743 million for the Q2 - marginally lower compared to losses of USD 770 million and USD 785 million in the previous two quarters.

Tesla also faces broader challenges that could make its cars more hard to sell.

More news: Zuckerberg Loses $16.8 Billion in a Snap as Facebook Plunges

As Tesla looks to real profitability in the coming quarters and years, controlling costs is extremely crucial in the automotive business.

Driving the shares higher was a sharp reduction in operating cash-flow losses: from almost $400 million in the first quarter down to just $130 million in the second. It had ended the first quarter with $3.2 billion in cash after spending $656 million in capital expenses.

The company began to burn through money as it attempted to reach its production milestone of 5,000 Model 3's a week.

Musk said he hopes to include "Tempest", "Missile Command", and "Pole Position" in this release, which indicates more games could potentially make their way into the vehicle software in the future.

Looking ahead, Tesla writes that Model 3 production should reach 10,000 units per week sometime next year. Analysts were projecting Tesla would go through about US$900 million during the period, after burning more than US$1 billion in three of the previous four quarters.

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