(Reuters) – Tesla Inc (TSLA.O) on Wednesday surprised investors by posting a profitable third quarter, boosted by record deliveries, cost cuts and improved production schedules for its new electric vehicle model, causing shares to soar in after-market trading.

Shares rose nearly 21% to $307.12 after hours on the surprise news, crossing $300 for the first time since March 1. Tesla on Wednesday posted a cash balance increase to $5.3 billion. The carmaker reported a profit of $1.86 per share, shattering analyst expectations for a loss of 42 cents per share.

The third-quarter results are an important milestone for Tesla and redemption for Chief Executive Elon Musk who had to step down as chairman after a series of scandals and investor doubts about Tesla?s ability to withstand competition from larger, better capitalized global rivals.

Tesla?s gross margins, an important profit indicator for investors, surpassed expectations and Tesla said it was ?highly confident? in exceeding the low end of its yearly global vehicle delivery goal.

Tesla also expects to generally be cash flow positive as it has grown to the point of being self-funding. (Graphic: tmsnrt.rs/2MF6HHq)

But revenue fell nearly 8% to $6.30 billion in the quarter ended Sept. 30. Analysts had expected revenue of $6.33 billion, according to IBES data from Refinitiv.

In May, Tesla raised a record $2.7 billion in capital when investors scooped up a mix of new stock and convertible notes to boost its cash-depleted balance sheet.

With Wednesday?s after-hours surge, Tesla?s stock has reduced its loss year-to-date to 8% and added about $9 billion to its market capitalization.

But Tesla rallies have been short-lived before.

A year ago, Tesla gave a quarterly report that similarly smashed investors? expectations, igniting a rally that sent its shares 31% higher over the next two months, only to see the stock decline through much of 2019 over worries about corporate governance, profitability and demand for the Model 3.

Investors in the past have shown impatience with the company?s serial failures to meet financial and production targets. Earlier this month, Tesla shares slumped after the company reported delivering 97,000 vehicles for the third quarter, just short of analysts? forecasts and only 2% ahead of the previous quarter.

But Tesla on Wednesday exceeded promises by billionaire Musk, who in July said Tesla would break even in the third quarter and turn a profit by the end of 2019.

The company has said it plans to deliver 360,000 to 400,000 vehicles for all of 2019, and on Wednesday said it was ?highly confident in exceeding 360,000 deliveries this year.?

?We have cleared initial milestones toward our manufacturing license and are working towards finalizing the license and meeting other governmental requirements before we begin ramping production and delivery of vehicles from Shanghai,? the company said in a statement.

Tesla has said it aims to produce at least 1,000 Model 3 cars a week at the new Chinese factory by the end of this year, but it is unclear when it will meet year-end production targets due to uncertainties around orders, labor and suppliers.

The electric car maker?s net income attributable to common shareholders was $143 million, or 78 cents per share, for the third quarter, compared with $311 million, or $1.75 per share, a year earlier.

Musk is trying to contain costs while spending on major new initiatives.

Besides working on its new Model Y and Shanghai factory, Tesla is also developing a gigafactory in Europe, a Semi truck, an electric pickup truck, a new generation of the Tesla Roadster and automated driving features.

Reporting by Akanksha Rana in Bengaluru and Tina Bellon in New York; Additional reporting by Noel Randewich in San Francisco; Editing by Saumyadeb Chakrabarty and Lisa Shumaker