Tesla’s earnings announcements often feature big surprises, but this one was a bolt of lightning. The California carmaker earned $1.86 a share in the third quarter, far exceeding even the most optimistic projections (according to Bloomberg, the smart money was expecting a 24-cent loss).

Revenue actually came in just short of expectations, at 6.3 billion (down 1% compared to last quarter). A decent profit with no revenue growth implies that margins are strong. Sure enough, Tesla reported automotive gross margin of 22.8%. That’s an improvement over last quarter’s 19%, indicating that the company’s ongoing quest to improve manufacturing efficiency is bearing fruit.

Demand, at least for Model 3, remains strong. Tesla reported deliveries of 79,703 units, up 3% compared to the previous quarter, and up 42% year-on-year (Model S/X deliveries are down 37% year-on-year, but seem to have stabilized). The company reiterated its guidance of delivering at least 360,000 vehicles in 2019, which would represent year-on-year growth of an impressive 16%.

Continued strong demand times good margins equals growth and future profits. Investors did the math and sent the stock soaring. TSLA gained over 17% the day after the announcement, costing the short sellers at least $1.4 billion, according to CNBC.

As usual, there were numerous nuggets of other promising news tucked into the report. Tesla now expects to reach volume production of Model Y (1,000 per week) by mid-2020, 6-9 months ahead of previous estimates. In the long term, the company expects Model Y to account for half of total deliveries – perhaps more than the three existing models combined. Preparations for production at Gigafactory 3 in Shanghai are also ahead of schedule, and production is expected to start this quarter.

Adding weight to these predictions is a widespread feeling that Elon Musk is getting better at managing expectations when it comes to timetables. In a recent tweet to a fan, he said the unveiling ceremony for the Tesla Pickup will take place in November, as planned.

Sources: Tesla, EVannex, Bloomberg, Electrek