Tesla shares ripped higher in the extended session Wednesday after the electric vehicle maker managed to score the third straight quarter of profitability in what was the company's best quarter for production and deliveries, despite the impact COVID-19 had on production amid factory closures.
The stock rallied over 9 percent and was trading well above the $800 closing price setting up CEO Elon Musk for a hefty payday.
Profits on an adjusted basis came in at $1.24 per share, beating Wall Street's expectations for a loss. Revenue was $5.9 billion, in line with estimates.
"Although impacted by inefficiencies related to the temporary suspension of production and deliveries in many locations, our gross margin remained strong," the company stated. "At Gigifactory Shanghai, further volume growth resulted in a material improvement in margins of locally made Model 3 vehicles. In addition, Model Y contributed profits, which is the first time in our history that a new product has been profitable in the first quarter."
The momentum in the shares, which have gained 91 percent this year, compared to the S&P 500's 9 percent drop, are good news for Musk who is inline for a windfall.
Through Tuesday, the automaker's market value has risen to a six-month average of $96.59 billion, as tracked by Dow Jones Market Data Group. If and when that figure nabs $100 billion, Musk has an option to buy 1.69 million shares of Tesla stock for $350.02 per share.
But for the options to vest, the market capitalization has to average above $100 billion for the next six months, and it has to be above $100 billion for the next 30 business days, according to the compensation packages contained in company filings with the U.S. Securities and Exchange Commission, as reported by the Associated Press.
As for forecasts, the company like many others noted the current environment makes it difficult to predict "how quickly vehicle manufacturing and its global supply chain will return to prior levels," hence the company will "revisit its 2020 guidance in our Q2 update" as stated in company materials.