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Tesla Beats Wall Street Forecasts with Quarterly Deliveries, Stocks Surge Up 10%

Tesla stock (TSLA) surged over 10% on Tuesday after the electric vehicle giant reported quarterly vehicle deliveries that exceeded Wall Street expectations. The company delivered 443,956 vehicles during the second quarter, surpassing the analyst consensus estimate of 439,302, according to market data.

“In the second quarter, we produced approximately 411,000 vehicles and delivered approximately 444,000 vehicles,” stated a company announcement. Tesla detailed that 422,405 of these were Model 3/Y vehicles, and 21,551 were other models.

This second-quarter delivery total is higher than the 386,810 vehicles delivered globally in the first quarter but lower than the approximately 466,140 delivered a year ago. Despite the year-over-year drop in deliveries, some analysts see signs that the EV industry may be performing better than anticipated.

“We see potential for improved sentiment in Tesla shares and broader EV sentiment compared to the negative sentiment we’ve witnessed over the past 6 months,” Citi analysts wrote on Tuesday. “Following this, the focus will shift to Tesla’s Q2 vehicle gross margins to measure the pricing vs. cost equation (Tesla reports July 23), as well as any information on future product launches.”

Tesla has faced stiff competition abroad from Chinese counterparts amid a declining market for EVs. Earlier this year, in an effort to reduce costs, Tesla embarked on a plan to cut more than 10% of its global staff, which some analysts interpreted as a signal of challenging times ahead.

During Tesla’s shareholder meeting last month, CEO Elon Musk confirmed that near-term demand and sales would continue to struggle as the industry goes through a transitional period. “It’s tough sledding out there,” Musk remarked of the EV industry, noting that competitors had similarly reduced their investment and manufacturing of electric vehicles.

Ahead of the delivery numbers on Monday, Wells Fargo analysts highlighted that the company’s gross margin would likely be impacted by the crowded market.