The shares rose 2.5 percent to $334.06 as of 4:35 p.m. Wednesday, after the close of regular trading.
The firm was also buoyed by Tesla's forecast that Model S and X sales in the second half of the year would be higher than the first six months of 2017.
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Assuming Tesla actually can pull off production increases for all three models, something Tesla CEO Elon Musk has called "production hell", the biggest challenge will be making sure quality remains high.
In its report, Tesla said it generated $2.79 billion in revenue during the quarter, doubling the $1.27 billion figure from the same period past year, most of it from Tesla's automotive division.
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Retail sales fell by only 1%, with Ford's share of the retail market actually increasing over the last three months inluding July. Only Ford's F-series, which increased 6%, improved on results from one year ago amongst the major truck models.
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Musk outlined the production plan for the Model 3, which forecasts a production of 5,000 cars per week by the end of 2017. However, the Model 3 version with a 310-mile range has a $44,000 starting price tag, undercutting Musk's promise to deliver a cheap vehicle to the masses. But Musk said there "will be significant carryover" from Model 3 production in order to bring the compact SUV to market faster. But Tesla's adjusted loss, of US$1.33 per share, handily beat Wall Street's forecast of a US$1.88 loss per share, according to analysts polled by FactSet.
Tesla also claims that revenue increased significantly last quarter.
In a letter to its shareholders, Tesla said the order rate for all vehicles was up 15 per cent on the second quarter in 2016 - which can be credited to the introduction of the Model 3. "The combined Model S and Model X market share grew in the U.S. premium luxury vehicle market during Q2 2017", the company said in its statement.
According to an analyst from the premier bank and financial institution, Morgan Stanley, the company has been focused on the huge vehicle demand, especially with the heightened hype and popularity of the cheaper alternative, the Model 3.
That went to the heart of two major investor fears about Tesla: That the Model 3 production ramp would be choppy and demand for the cheaper sedan would chip away at demand for Tesla's pricier vehicles.