Congrats to investors willing to take a flyer on a mostly-weak Tesla (NASDAQ:TSLA) before Wednesday’s closing bell rang. Down nearly 16% for the past twelve months and off by the same 16% since peaking in June, Tesla stock wasn’t exactly inspirational. Up more than 4% following the post-close release of its second-quarter numbers, at least some traders have changed their mind.

They may have good reason for rethinking things. Although some spending went up for the quarter, CEO Elon Musk notes that margins on automotive products edged a little higher, including for the ballyhooed Model 3. The Model 3’s profitability is expected to soar during the quarter currently underway, in step with an all-around increased output.

Then again, most investors know to take things Musk says with a grain of salt, as he has a knack for overestimating how quickly and cost-effectively Tesla can make forward progress.

Tesla Earnings Recap

For the quarter ending in June, electric carmaker Tesla turned revenue of $4.0 billion into an operating (non-GAAP) loss of $3.06 per share. The company lost $1.33 per share in the second quarter of last year, when it produced sales of $2.8 billion. For the quarter just completed, analysts were collectively calling for a loss of $2.89 per share and a top line of just under $4.0 billion.

During the quarter, the company made 53,339 vehicles, delivering 22,319 Model S and Model X vehicles and 18,449 Model 3 vehicles. But, in that Tesla has already reported the unit numbers in early July, the market didn’t regard it as new information. What was new, however, was the pace of output achieved since the quarter ended in June.

Since the end of that month, the company has been able to regularly produce approximately 7000 vehicles per week. At that annual pace of roughly 350,000, Tesla should be able to become “sustainably profitable for the first time in our history,” according to the quarterly statement from the company.

Musk noted in the same letter/report to shareholders, “Now that we have reached a production rate of 5,000 Model 3 vehicles per week, we are focused on further ramping production, and achieving profitability and continuous cost efficiencies. We expect to produce 50,000 to 55,000 Model 3 vehicles in Q3,” adding “Model 3 gross margin should grow significantly to approximately 15% in Q3 and to approximately 20% in Q4 predominantly due to continued reduction in manufacturing costs and to some extent an improving mix.”

The 4% jump Tesla stock made in after-hours trading suggests the majority of traders believed him. But, much will have to change between now and then if the company is to meet the lofty goal.

Drilling Down Into Tesla’s Earnings

Although revenue scaled up, so did costs. Operating expenses swelled from $907 million to $1.24 billion year-over-year, and cost of revenues jumped from $2.12 billion to $2.66 billion. The end result was a significant decline in operational profitability, from a loss of $240.9 million to a loss of $621.4 million.

Restructuring costs of $103.4 million crimped the overall bottom line, but it was the sizable relative increase in ordinary operating expenses that took the biggest bite out of the company’s results. Services costs grew 59% to $3.4 billion, while selling and administrative expenses were up 40% to $750.8 million. The total amount of net cash consumed by operations was $129.7 million.

That was an improvement on the negative cash flow of $200 million in the same quarter a year earlier and a notable sequential improvement. But, Tesla is still burning money, ending the quarter with $2.8 billion worth of liquidity.

It’s sure to be a point of contention for investors and analysts, many of whom believe Tesla will need to raise fresh capital if it wants to say afloat. Musk said in May he has no plans to raise funds, and he didn’t offer any outlook to the contrary in the Q2 letter.

Buckle Up

If there are going to be significant fireworks regarding the plausibility of the company’s suggested bright future, they’ll likely take shape during the conference call rather than within the quarterly report itself.

During Tesla’s first quarter conference call, a series of uncomfortable analyst questions led Musk down an increasingly belligerent path of answers, including cutting off Sanford Bernstein analyst Toni Sacconaghi’s question about future capital requirements by saying “Excuse me. Next. Boring, bonehead questions are not cool. Next?”

Tesla’s chief acknowledged the next day that he handled things poorly — and offered an apology — which temporarily slowed the selloff from Tesla stock. The bigger-picture damage had already been done though. And, Musk has since dished out similarly controversial public comments, implying he’s learned little from the experience.

The second quarter call is scheduled for Wednesday, 5:30 pm EST.

Looking Ahead for Tesla Stock

For the quarter now underway, analysts are — or were anyway — expecting a loss of 95 cents per share and revenue of $5.8 billion, both of which would be remarkably better than year-ago figures. For the full year, those pros were modeling a bottom line loss of $6.83 per share of Tesla stock and a top line of $19.8 billion.

It remains to be seen to what degree they’ll change their outlooks, though it may matter very little, if at all. Tesla is if nothing else a moving target, and largely unpredictable when it comes to its fiscal performance.

Traders, however, are not so unpredictable. Choosing to see the glass as half-full rather than half-empty while buying into Musk’s optimism by buying into Tesla stock, it appears the market is ready to put shares back into a bullish mode after a year of lethargy. It remains to be seen how long that enthusiasm will last. It could be quelled by the time the conference call is over, or further stoked.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.