Tesla Sees Big Declines In 2025 Numbers, Offers Optimistic Outlook For 2026

A mix of declining sales and new product expenditures combined to cut Tesla Inc.’s full-year and fourth-quarter earnings results, with the electric vehicle maker posting drops in revenue and profit but offering a rosy outlook.

The company’s automotive revenue dropped 10 percent for all of 2025, due on large measure to the decline in EV sales after the federal government ended the $7,500 tax credit for new electric vehicles last September. Prior to that, however, Tesla was already lagging its previous year’s quarterly automotive revenues due to increased competition from other automakers.

Tesla’s overall revenue, which includes its energy generation and storage business and sales of carbon credits to other automakers, was $94.8 billion, a 3 percent drop compared to 2024 results. The company’s net income fell substantially, coming in at $3.8 billion. That was a decline of 46% on a year-over-year basis. 

For the fourth quarter of last year, the company’s overall revenue fell 3 percent to $24.9 billion, while its net income dropped 61 percent to $840 million, compared to $1.4 billion during the year-ago period.

Tesla investors responded positively to the numbers, with the stock rising over 3 percent early in after-hours trading.

Tesla officials noted the company was dealing with a lot of moving parts last year, including ramping up Cybercab business, continuing the development of humanoid robots for production as well as its full self-driving program.

Additionally, the company completed the rollout of its refreshed Model Y while still forging ahead on Cybertruck and Semi trucks.

“In 2026, we will further invest in the infrastructure needed to support clean energy and transport and autonomous robots, including the ramp of six new production lines across vehicle, robots, energy storage and battery manufacturing, while further leveraging our existing factory, charging and service center footprint to support future growth,” the company noted in a letter to shareholders.

Those new production efforts include “production ramps of the Tesla Semi and Cybercab, both commencing” in the first half of this year. Officials noted development on the second-generation Roadster, Tesla’s first offering, continues as well.

“We continue to evolve and augment our product lineup with a focus on cost, scale and future monetization opportunities via services powered by our AI software,” the company noted. “We remain focused on growing our sales volumes through a differentiated and efficiently managed product portfolio, which includes leveraging and optimizing our existing production capacity before building new factories and production lines.”

[Image: Tesla]

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