Revenue

9% decline YoY " "

Revenue fell 9% YoY to $21.3 billion, driven by reduced vehicle average selling prices due to mix changes, production disruptions (from the Model 3 update at Fremont and Giga Berlin issues), and a negative foreign exchange impact of $0.2 billion; these issues had also affected previous periods. " "

Operating Income

Decreased to $1.2 billion (5.5% margin) "

Operating income dropped to $1.2 billion, resulting in a 5.5% margin, due to lower vehicle ASP, increased operating expenses from investments in AI, cell advancements, and Cybertruck production ramp costs—a continuation of challenges seen in prior periods that compounded current results. "

Cash Flow

Negative free cash flow of -$2.5 billion; $2.2 billion decrease in cash and investments " "

The free cash flow was -$2.5 billion with a sequential decline in cash and investments of $2.2 billion, primarily due to a $2.7 billion increase in inventory and $1.0 billion in AI infrastructure capex, reflecting ongoing aggressive investment initiatives that have also affected previous periods. " "