Record sales push Tesla to 2nd straight quarterly profit

DETROIT (AP) — Record electric vehicle sales in the fourth quarter helped to push Tesla Inc. to its second-straight quarterly profit, giving bullish investors optimism that sustained black ink lies ahead.

The Palo Alto, California, company said it made a net profit of $105 million from October through December, or 56 cents per share, but still posted an annual loss of $862 million.

The fourth-quarter earnings almost certainly will continue Tesla’s meteoric stock appreciation. Shares rose more than 11% in after-hours trading Wednesday to $647.93

The company said in its quarterly investor letter that it expects to “comfortably” exceed production of 500,000 vehicles at its factories in Fremont, California, and Shanghai.

Tesla said it is starting to ramp up production of the Model Y small SUV in Fremont, a key product for the company. Deliveries are to start by the end of March.

The Model Y will be able to go up to 315 miles (507 kilometers) per charge, an increase over Tesla's previous estimate of 280 miles (451 kilometers), according to the letter.

Model Y production in Shanghai will start in 2021. The company also said it plans to start producing limited numbers of its electric semi truck this year.

Tesla also said in the investor letter that it's moving ahead with preparations for a factory near Berlin, and the first deliveries from the factory are expected next year.

Tesla expects net profits going forward, with some possible exceptions at times surrounding the launch of new products.

“We continue to believe our business has grown to the point of being self-funding,” the letter said.

Tesla shares have more than tripled in value since May of last year, pushing the company’s market value above giant German automaker Volkswagen as well as the combined...