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Photo: Smith Collection/Gado/Contributor/Getty Images

Tesla had a good night, and now the question is whether it's a new day for the pioneering but volatile automaker that kicked off the push to move electric vehicles toward the mainstream.

Driving the news: Tesla surprised Wall Street with a $143 million third-quarter profit on Wednesday evening, and announced plans to ramp up vehicle production at its China factory sooner than expected.

  • The results sent the stock surging by over 20% in after-market trading. It was still up by 18% when the market opened Thursday.
  • The company also announced that deliveries of its Model Y SUV crossover will launch next summer, ahead of schedule.

What they're saying, via AP: Wedbush Securities analyst Daniel Ives called it a "jaw dropper," adding, "The Street wanted profitability and Tesla delivered in big fashion."

Why it matters: Tesla's recent cash-losing streak is over, though the company turned a bigger profit in 2018's Q3 with $311 million, and the company talked up its cost-controlling efforts.

  • However, Tesla also saw its first annual revenue drop since 2012, as it sells more of its lower-priced Model 3 vehicles and fewer higher-priced models.

But, but, but: Tesla has yet to prove it can be consistently profitable, and it's facing rising competition as legacy automakers and startups alike roll out new electric models.

  • And the company has already reached the ceiling for consumers to use the full $7,500 tax credit, which is limited to 200,000 vehicles per manufacturer, and phases down from there. That could give a price edge to competitors that can still take advantage of the incentive.
  • "We think questions remain regarding the sustainability of these results, particularly as EV competition ramps up and its tax credit goes away," CFRA analyst Garrett Nelson tells MarketWatch.

Go deeper

Biden plans to ask public to wear masks for first 100 days in office

Joe Biden. Photo: Mark Makela/Gettu Images

President-elect Joe Biden and Vice President-elect Kamala Harris sat down with CNN on Thursday for their first joint interview since the election.

The big picture: In the hour-long segment, the twosome laid out plans for responding to the pandemic, jump-starting the economy and managing the transition of power, among other priorities.

The quick FCC fix that would get more students online

Illustration: Sarah Grillo/Axios

As the pandemic forces students out of school, broadband deployment programs aren't going to move fast enough to help families in immediate need of better internet access. But Democrats at the Federal Communications Commission say the incoming Biden administration could put a dent in that digital divide with one fast policy change.

State of play: An existing FCC program known as E-rate provides up to $4 billion for broadband at schools, but Republican FCC chairman Ajit Pai has resisted modifying the program during the pandemic to provide help connecting students at home.

Dion Rabouin, author of Markets
1 hour ago - Politics & Policy

America's hidden depression

Biden introduces his pick for Treasury secretary, Janet Yellen, on Dec. 1. Photo: Alex Wong/Getty Images

President-elect Biden faces a fragile recovery that could easily fall apart, as the economy remains in worse shape than most people think.

Why it matters: There is a recovery happening. But it's helping some people immensely and others not at all. And it's that second part that poses a massive risk to the Biden-Harris administration's chance of success.