In this segment from Motley Fool Live, senior technology specialist Daniel Sparks reviews key metrics from Tesla's (NASDAQ:TSLA) third-quarter earnings report, including revenue and management's full-year guidance. In addition, Daniel details how the electric-car maker's vehicle production rates and deliveries are surging.


Daniel Sparks: I won't bore you, just jump into the numbers. What we did know going into the report was we knew it was going to be a big quarter, deliveries were up sharply. They had already announced that deliveries were up 43 percent year-over-year and 53 percent sequentially -- record quarterly deliveries. They had a full recovery from their factory shutdowns during the second quarter. I glanced over at the report and revenue was expected to be up about 31 percent year-over-year. Instead, it was up 39 percent year-over-year. I haven't had too much time to look into how much of that has to do with regulatory credits but I think that just from a quick glance that it's probably quite a bit because regulatory sold credits were 397 million compared to 134 million in the year-ago quarter. But that's still a small chunk of the total revenues, which were $8.8 billion.

Then can you just believe that? $8.8 billion in a single quarter? I've been covering this company a long time. That's huge compared to five years ago.

Then another thing I wanted to look for quickly was signs of how demand is fairing because really this is a growth story and investors want to check on that growth story every quarter. They did say in the outlook section of their report that they still have the capacity installed to produce and deliver 500,000 vehicles this year but they said, "achieving this goal has become more difficult. Delivering half a million vehicles in 2020 remains our target."

Now just some background on that. I mean, they've had to pump out a lot of deliveries in the final two quarters, to even have a shot. Going into 2020, their guidance was 500,000 vehicles or more, but then the factory shutdown put them back on that target -- and then they brought that guidance back after the factory reopened. It's still an ambitious target and we're talking that would be up from 368,000 vehicles last year, so wild growth in the face of the challenges they've had this year.

But what's interesting is they say, this is what's key to me in the report, is they highlight that demand must be fine because it's not whether or not they're going have enough demand to do 500,000 vehicles, it has only to do with production. I'm just going to read them right here from this report.

Achieving this target depends primarily on quarter-over-quarter increases and Model Y and Shanghai production, as well as further improvements in logistics and delivery efficiency at higher volume levels.

Two bottlenecks there: production and our ability to get the vehicles in the hands of customers. No mention of demand being an issue. This has always been my thesis that demand grows in proportion to deliveries because of the word of mouth of the vehicle and, of course, they don't have advertising, so that makes sense and it looks like that thesis continues to play out.

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