Tesla has reported a surprise profit for the third quarter, fulfilling CEO Elon Musk’s promise the company would start booking profits in the second half of 2018.

According to cnbc.com, the company’s earnings report, released after the markets closed last night (24 October), also showed better than expected car sales and a faster timeline on Model 3 production. The automaker said the midsize Model 3 sedan was the best selling car in the US measured by revenue and the fifth on volume.

Musk told analysts on a call it was an “incredibly historic quarter” for the company.

Cnbc.com reported how the company did compared with what Wall Street expected, based on average estimates of analysts polled by Refinitiv:

  • Adjusted earnings: $2.90 a share vs. an expected loss of 19 cents per share
  • Revenue: $6.82bn vs. an expected $6.33bn

Tesla booked net income of $311.5m, or $1.75 per share, compared with $619.4m (-$3.70) in red ink, or $3.70 per share, a year ago.

Revenue soared 70.5% from $4bn in June and more than doubled versus the same period in 2017.

After one-off adjustments, Tesla booked a profit of $516m during the quarter. This, cnbc.com noted, was Tesla’s third profitable quarter and compared with an adjusted loss of $520m a year ago.

The company confirmed it also expects to book profit during the fourth quarter.

Tesla said the number of labour hours to build the Model 3 fell by over 30% from the second to the third quarter, and it took less time to build than the Model S sedan and Model X SUV – another first for the company.

The EV maker had said on 2 October it made 53,239 Model 3s during the quarter, short of the 5,000 a week quarterly goal, but built over 5,300 during the last week of the quarter.

“We will focus even further on cost improvements while continuing to increase our production rate” during Q4, the company told cnbc.com.

Musk told analysts on a call that demand for Model 3s was “probably on the order of anywhere from 500,000 to 1m cars a year”.