Tesla posted its third quarterly profit in a row despite a slump in consumer demand and the pandemic that forced factory shutdowns.

Tesla had initially resisted efforts by California authorities to shut the company's plant in the Bay Area under the lockdown, until agreeing on March 19 to suspend production. Even so, Tesla on Wednesday reported its third profitable quarter in a row.

On a conference call on Wednesday, Tesla CEO Elon Musk said he did not know when Tesla could resume production in California and called the state stay-at-home order a “serious risk” to the business.

“To say that they cannot leave their house and they will be arrested if they do, this is fascist. This is not democratic, this is not freedom. Give people back their goddamn freedom!”

Late on Wednesday, the Tesla CEO doubled down on his stance, in response to a journalist’s tweet that quoted Musk’s remarks of calling the stay-at-home orders fascist. “Hell yeah!!”, Musk said on Twitter.

Musk tweeted on March 6 that “the coronavirus panic is dumb” but later offered to supply hospitals with free ventilators.

Although impacted by inefficiencies related to the temporary suspension of production and deliveries in many locations, Tesla's gross margin in Q1 remained strong.

At Gigafactory in Shanghai, further volume growth resulted in a material improvement in margins of locally made Model 3 vehicles. In addition, Model Y contributed to profits, which is the first time in Tesla's history that a new product as been profitable in the first quarter.

Q1 highlights

• In Q1, Tesla reached its highest ever revenue for a seasonally slower first quarter as its total revenue grew 32% YoY. Sequentially, Tesla's revenue was mainly impacted by lower deliveries, driven primarily by limitations on the company's ability to deliver vehicles towards the end of the quarter. Tesla's average selling price declined further as the company;s mix continues to shift from Model S and Model X to the more affordable Model 3 and Model Y.
• Of the $5.1 billion in overall automotive revenue, nearly 7% were due to regulatory credits - money Tesla receives from other automakers that buy the company’s carbon emissions credits to meet stricter regulation. Revenue from those credits nearly tripled from the last quarter.
• Excluding items, Tesla posted a profit of $1.24 per share.
• Tesla's automotive gross margin of 25.5% as well as total gross margin of 20.6% both reached their highest levels in 18 months.

Tesla said it could not predict how quickly vehicle manufacturing and global supply chains will normalize, saying it would revisit full-year guidance for net income and cash flow when it reports current-quarter results in three months.

Musk said that while other carmakers were cutting back, Tesla was ramping up investment. He said Tesla might announce the location of a new U.S. factory in one to three months.

The company on Wednesday did not update its previous forecast of delivering half a million vehicles by the end of 2020.

Tesla on Wednesday said it expected production at its vehicle factories in Fremont, California and in Shanghai, China to ramp up gradually through the second quarter.

The company said operations at its Shanghai plant were progressing better than expected, with production rates of its Model 3 sedan expected to hit 4,000 units per week, or 200,000 per year, by mid-2020.