Tesla Motors (NASDAQ:TSLA) crushed analysts' estimates for its first quarter, once again proving the shorts wrong. We knew Tesla would post its first-ever quarterly profit when it reported earnings yesterday. However, we didn't know that it would be to the tune of $0.12 per share on revenue of $561.8 million. This is markedly above Wall Street's expectations for just $0.03 a share and revenue of $500.2 million for the period.

Shares of Tesla rallied on the news, with the stock opening at $69 per share today -- a gain of more than 23% from yesterday's close. The performance in the stock was no doubt helped by the 83% jump in sales from the year-ago period. Tesla even beat its own projected sales target. Perhaps, more importantly, Tesla outpaced sales of General Motors' (NYSE:GM) Chevy Volt, as well as sales of Nissan's plug-in LEAF.

Company Model

Number of Cars Sold in the Quarter

Tesla Model S

4,900 

GM Chevy Volt

4,421

Nissan LEAF

3,695

These numbers hint at something even more critical to Tesla's sustainability and the budding EV market at large: Demand for luxury electric vehicles is stronger than many expected. The key word here is luxury. The critics have long argued that the Tesla Model S was too expensive to really break into the mainstream.

More affordable EVs from GM and Nissan, on the other hand, were supposed to sell on more of a mass scale. As fellow Fool John Rosevear points out, GM expected to sell 10,000 Chevy Volts in its first year on sale. However, it only sold 7,671 that year. Tesla says it will deliver 20,000 all-electric Model S cars this year.

Moreover, on the earnings call yesterday Tesla CEO Elon Musk said that 25% of the people who test-drive a Tesla Model S buy one. That's impressive considering the base cost of the car is $62,400 after a $7,500 federal tax credit. Nevertheless, strong demand for the Model S paired with the company's new financing program bodes well for Tesla going forward.

Tesla has so far done a great job of exceeding expectations, and I suspect it will continue to impress investors for many more quarters to come.

Motley Fool contributor Tamara Rutter owns shares of Tesla Motors. The Motley Fool recommends General Motors and Tesla Motors. The Motley Fool owns shares of Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.