On the open this afternoon, the share price of Tesla has increased by more than 14 percent. IT was buoyed by promises that the company will be cashflow-positive by the end of the current year.
According to data that were compiled by S3 Partners, the short sellers of Tesla have lost more than $1.1 billion in potential gains as an outcome.
The electric carmaker is spearheaded by Elon Musk, its charismatic chief executive. It reported a quarterly revenue that was well above the expectations of analysts during a results reveal last night at $4 billion (£3.05 billion).
Despite the losses of the company rising dramatically because of the ramping up of its production of its Model 3, Musk reaffirmed his previous claim that Tesla will not need to raise in fresh capital in 2018 in order to achieve his target.
In a somewhat more surprising turn of events, his well-mannered behaviour during its post-earnings call has persuaded the investors that Musk may already be turning a new leaf. In the call of Tesla for the last quarter, Musk threw insults at some analysts and labelled the questions “boneheaded” and “boring.” His actions subsequently knocked $2 billion off the market capitalisation of the company.
Late last night, Musk said to the shareholders: “I would like to apologise for being impolite on the prior call.”
He added: “Honestly, I think there is really no excuse for bad manners. I was kind of violating my own rule in that regard.”
A senior analyst at Investing.com, Clement Thibault, stated: “One must understand that Musk embodies Tesla, and the company will only go as far as he can take it.”
He added: “This emotional investment and dependence on Musk is what makes Tesla so volatile and vulnerable to controversy.”
Thibault concluded: “In the end, Tesla’s quarterly results and delivery numbers matter far less than the partisanship and group affiliation surrounding Tesla and its CEO.”