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Tesla, Inc. (TSLA)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 results were weak: revenue fell 9% YoY to $19.335B and operating margin compressed to 2.1% amid Model Y line changeovers and lower ASPs . Non-GAAP diluted EPS was $0.27 vs S&P Global consensus $0.41 (miss); revenue $19.34B vs consensus $21.33B (miss)* .
  • Energy continued to be an offset: Q1 Energy revenue was $2.730B (+67% YoY) with sequential gross margin improvement; Powerwall deployments hit a fourth sequential record and Shanghai Megafactory produced >100 Megapacks .
  • Management flagged tariff headwinds (vehicle business partially insulated via regionalization; outsized impact on Energy), R&D ramp in AI/Optimus/Cybercab, and will revisit 2025 guidance in Q2 .
  • Catalysts: pilot launch of unsupervised Robotaxi rides in Austin targeted for June; more affordable vehicle models still planned to start production in H1 2025; Cybercab volume in 2026 .

What Went Well and What Went Wrong

What Went Well

  • Energy and Services & Other strength: Energy revenue grew to $2.730B (+67% YoY) and sequential Energy gross margin improved; Services & Other revenue was $2.638B (+15% YoY) with gross profit up 25% YoY .
  • Operational execution on New Model Y ramp: Tesla updated production lines across all factories, with Shanghai finishing ramp in six weeks and record APAC orders on launch day .
  • Strategic AI/autonomy progress: Launch of FSD (Supervised) in China, cars autonomously driving from production line to outbound lots, and Robotaxi pilot targeted for June in Austin .

Quote: “We expect to have—be selling fully autonomous rides in June in Austin… Once it moves the financial needle… it will really go exponentially from there.” — Elon Musk .

What Went Wrong

  • Automotive softness: Total deliveries fell to 336,681 (-13% QoQ; -13% vs Q4), automotive revenue declined to $13.967B (down from $19.798B in Q4) and GAAP gross margin stayed low at 16.3% .
  • Profit pressures: Operating income dropped to $0.399B; auto margins declined due to lower deliveries, fixed-cost absorption during factory changeovers, and lower regulatory credits .
  • Tariff and brand headwinds: Section 232 auto tariffs expected to impact profitability; outsized Energy impact due to LFP sourcing; management cited vandalism/hostility in certain markets and will revisit 2025 guidance in Q2 .

Financial Results

MetricQ3 2024Q4 2024Q1 2025 ActualQ1 2025 Consensus*
Revenue ($USD Billions)$25.182 $25.707 $19.335 $21.327*
GAAP Diluted EPS ($)$0.62 $0.66 $0.12 —
Non-GAAP Diluted EPS ($)$0.72 $0.73 $0.27 $0.415*
GAAP Gross Margin %19.8% 16.3% 16.3% —
Operating Margin %10.8% 6.2% 2.1% —
Adjusted EBITDA ($USD Billions)$4.665 $4.922 $2.814 —
Adjusted EBITDA Margin %18.5% 19.1% 14.6% —

Segment revenue breakdown:

Segment Revenue ($USD Billions)Q3 2024Q4 2024Q1 2025
Automotive$20.016 $19.798 $13.967
Energy Generation & Storage$2.376 $3.061 $2.730
Services & Other$2.790 $2.848 $2.638

KPIs:

KPIQ3 2024Q4 2024Q1 2025
Production (Units)469,796 459,445 362,615
Deliveries (Units)462,890 495,570 336,681
Energy Storage Deployed (GWh)6.9 11.0 10.4
Global Vehicle Inventory (Days of Supply)19 12 22
Supercharger Stations6,706 6,975 7,131
Supercharger Connectors62,421 65,495 67,316

Additional cash metrics:

  • Cash, cash equivalents & investments: $36.996B (+$0.433B QoQ) .
  • Cash from operations: $2.156B; CapEx: $1.492B; Free cash flow: $0.664B .

Actual vs Consensus (Q1 2025):

MetricActualConsensus*Surprise
Revenue ($USD Billions)$19.335 $21.327*MISS
Non-GAAP Diluted EPS ($)$0.27 $0.415*MISS
EPS Estimates Count—28*—
Revenue Estimates Count—27*—

*Values retrieved from S&P Global.

Guidance Changes

Metric/TopicPeriodPrevious GuidanceCurrent GuidanceChange
Vehicle growthFY 2025“Return to growth in 2025” (rate depends on autonomy, factory ramp, macro) “Rate of growth this year will depend on autonomy, factory ramp, macro; revisit 2025 guidance in Q2” Lower clarity; defers specifics
Energy deploymentsFY 2025“Grow at least 50% YoY” No explicit target; tariff headwinds noted; Shanghai Megafactory to support ex-U.S. Reduced specificity
Affordable modelsH1 2025Start of production in H1 2025 Still on track for start of production in H1 2025 Maintained
Robotaxi pilot (Austin)2025“Begin launching later this year in parts of U.S.” “Selling fully autonomous rides in June in Austin” Timing specified (June)
Cybercab volume2026Volume production in 2026 Volume production in 2026 Maintained
CapExFY 2025Not specified in Q4 deck“In excess of $10B this year,” subject to tariff-related equipment costs New quantitative guidance
Tariffs2025Not detailedSection 232 auto tariffs to affect profitability; Energy impact outsized (LFP cells), mitigation via U.S. LFP equipment commissioning and non-China supply New headwinds disclosed

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
AI/AutonomyFSD V12 progress; 50k H100 cluster; plan to launch Robotaxi later in 2025 Pilot launch targeted for June in Austin; cars autonomously drive to outbound lots; FSD launched in China; generalized solution with potential localized parameter sets Acceleration; more specific timelines
Supply chain & localizationRecord cost reductions; regionalization underway 85% USMCA compliance; dual-sourcing; regionalization in NA/EU/CN; mitigation of tariff risks Reinforcement under tariff pressure
Tariffs/MacroMacro headwinds; cautious outlook Section 232 auto tariffs; outsized Energy impact; capex equipment import costs; guidance revisit Headwinds intensified
Product performanceRecord Q4 deliveries; New Model Y launched Model Y line changeovers led to weeks of lost production; APAC record orders; Shanghai ramp in 6 weeks Transition effects short-term negative
Energy businessRecord deployments/margins in Q3 & Q4; Shanghai Megafactory completed Energy margin improved sequentially; Powerwall records; >100 Megapacks produced in Shanghai Continued strength
R&D execution (Optimus/Cybercab)Optimus pilot production planned 2025; Cybercab unboxed process Thousands of Optimus by year-end (ramp risks noted); Cybercab builds in Q2; unboxed line aims for 5-second cycle over time Advancing with realistic ramp caution

Management Commentary

  • Strategic focus: “The future of the company is fundamentally based on large-scale autonomous cars and… vast numbers of autonomous humanoid robots… Tesla… will be the most valuable company in the world by far” — Elon Musk .
  • Robotaxi timeline: “Selling fully autonomous rides in June in Austin… financial impact around the middle of next year” — Elon Musk .
  • Tariff stance and mitigation: “On a weighted average basis, 85% USMCA compliant… Section 232 auto tariffs… will have an impact… outsized [impact] on the Energy business” — Vaibhav Taneja .
  • Energy thesis: “Utility companies… are buying Megapacks at scale; gigawatt-class battery is common… stationary energy storage to scale ultimately to terawatts per year” — Elon Musk .
  • Operational achievement: “Updating all our factories for the best-selling car… all at the same time… big kudos to the team” — Vaibhav Taneja .

Q&A Highlights

  • Market share debate: Why not higher share vs BMW/Mercedes? Musk argued buyers will transition to autonomous transport; personal ownership becomes less compelling over time .
  • Unsupervised autonomy readiness: Team burning down long-tail interventions; Austin build to include audio input for emergency vehicle handling; remote support for availability, not safety-critical .
  • Pricing/tiered FSD: Management views current $99 FSD price as “too cheap” as capability expands; potential multi-tier differentiation when unsupervised launches .
  • Vision-only robustness: Direct photon counting enables driving toward sun and in low light/fog; counters glare/visibility concerns .
  • Robotaxi scale: Initial launch starts with ~10–20 vehicles day one in Austin, ramping rapidly thereafter .

Estimates Context

  • Q1 2025 results missed consensus: revenue $19.335B vs $21.327B* and non-GAAP diluted EPS $0.27 vs $0.415*; 27 revenue estimates and 28 EPS estimates contributed to consensus*.
  • Implication: Street models likely need to reflect auto margin compression from lower deliveries/ASP, tariff impacts (esp. Energy), and later-than-FY25 material autonomy monetization (management indicates mid-2026 financial needle movement) .

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • The quarter’s weakness is predominantly transitional (New Model Y line changeovers, lower ASPs) but margin pressure is real; operating margin fell to 2.1% and non-GAAP EPS to $0.27 .
  • Energy remains a bright spot with robust deployments and improving margins; Shanghai Megafactory adds capacity to offset U.S. tariff impacts ex-U.S. .
  • Near-term headwinds: Section 232 auto tariffs and outsized Energy tariff exposure, plus R&D spend in AI/Optimus/Cybercab elevate OpEx; CapEx guided >$10B .
  • Autonomy catalysts: Austin Robotaxi pilot in June; generalized FSD approach scaling across regions; potential for material P&L impact starting mid-2026 per management commentary .
  • Affordable models production remains on track for H1 2025, aiding volume/utilization within existing lines during uncertain macro/tariff environment .
  • Liquidity strong: $36.996B cash & investments, positive FCF $0.664B, supporting continued investment through uncertainty .
  • Trading lens: Expect estimate revisions and heightened focus on tariff resolution and autonomy execution milestones; stock narrative will hinge on proving unsupervised FSD robustness and affordable model ramp while Energy offsets margin pressure .
Note: Q1 2025 production/deliveries press release confirmed 362,615 produced and 336,681 delivered; Energy deployments 10.4 GWh **[1318605_e1e67abcd9e74beeaa2cfda529caebf8_0]**. Financial recast reflects new crypto assets standard; non-GAAP presented net of digital assets gains/losses, contributing to other income volatility ($472M Bitcoin mark-to-market drop vs Q4) **[1318605_0001628280-25-018851_exhbit991.htm:2]** **[1318605_0001628280-25-018851_exhbit991.htm:11]** **[1318605_TSLA_3422658_6]**.