Tesla is looking a little more like the energy company Elon Musk envisioned

Tesla had a blowout second quarter, beating Wall Street’s estimates and proving that it can be a profitable car company.


Image Credit: Tesla


But the knockout earnings numbers of over $1 billion in net income the company reported — indicating strong car sales and efficient operations inside its manufacturing facilities — overshadow another story the company has to tell. And that’s in its energy business.


As CNBC’s Lora Kolodny reported, Tesla took in $801 million in revenue from its energy business including solar for homes and businesses and its energy storage services for residential and utility customers. That’s an increase of 60% over the previous quarter.


In court testimony from earlier this month, Tesla’s chief executive Elon Musk disclosed that demand for the company’s home energy storage units hovered around 80,000, but that it wouldn’t be able to meet that demand due to the worldwide shortage in computer chips.


While the energy business is an increasing part of Tesla’s value proposition to investors and to customers, its pole position in the electric vehicle industry remains the north star of the company’s business.


That business, for the record, is also booming, as Barron’s noted today. Tesla’s earnings came in at $1.45 per share from $12 billion in sales. compared to Wall Street‘s targets of $0.94 cents per-share from $11.5 billion in sales.


Beyond that, Tesla reported operating profit came in at $1.3 billion. That is a new quarterly record, almost $500 million more than Wall Street expected, and something bulls will point to as a fresh catalyst for the stock.


The stars have aligned for Tesla this quarter, but the company is going to face some stiff competition in the electric vehicle market in the latter half of the year and into 2022 as big automakers finally bring popular, low-cost models to market.


When that competition does become more intense, Tesla will need its energy business to shine to keep shareholders happy. The solid quarter Tesla enjoyed helps make the case that even in a tougher market, Tesla’s stock can stay the course.

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