Quick Takeaways
- Tesla operating income declined sharply in Q4 and full-year 2025 amid lower vehicle sales.
- Energy storage and manufacturing investments remained a strategic focus despite profit pressure.
On January 28, Tesla reported its fourth-quarter and full-year 2025 financial results, highlighting pressure on core automotive performance as the company increasingly prioritizes energy, autonomy, and artificial intelligence initiatives alongside vehicle manufacturing.
In the fourth quarter, total revenue declined 3% year-on-year to USD 24.9 billion. Automotive revenue fell more sharply, down 11% to USD 17.7 billion. Tesla operating income decreased 11% year-on-year to USD 1.4 billion, while operating margin narrowed to 5.7% from 6.2% in the same period last year. Adjusted EBITA slipped 4% to USD 4.2 billion, and net income dropped to USD 0.8 billion, reflecting a 61% decline.
For the full year 2025, total revenue came in at USD 94.8 billion, down 3% compared with the prior year. Automotive revenue declined 10% to USD 69.5 billion, while Tesla operating income fell 38% to USD 4.4 billion. Operating margin contracted significantly to 4.6% from 7.2% a year earlier. Adjusted EBITA decreased 9% to USD 14.6 billion, and net income declined 46% to USD 3.8 billion.
Vehicle production and deliveries performance
During Q4 2025, Tesla produced 434,358 vehicles, representing a decline of approximately 5% year-on-year. Of this total, 422,652 units were Model 3 and Model Y, while 11,706 units came from other models.
Vehicle deliveries in the quarter totaled 418,227 units, down around 16%. Model 3 and Model Y accounted for 406,585 deliveries, with the remaining 11,642 units attributed to other models.
Across the full year, Tesla produced 1,654,667 vehicles, a decrease of roughly 7% compared with the previous year. Model 3 and Model Y represented the majority at 1,600,767 units, while other models contributed 53,900 units.
Total deliveries for 2025 reached 1,636,129 units, down approximately 9%. Of these, 1,585,279 units were Model 3 and Model Y, and 50,850 units were other models.
Energy storage, manufacturing, and technology roadmap
Tesla recorded its highest-ever quarterly energy storage deployments in Q4, reaching 14.2 GWh, supported by record Megapack deployments. The company plans to begin Megapack 3 and Megablock production at Megafactory Houston in 2026, underscoring the growing role of energy storage in its business mix.
Preparations are ongoing at Gigafactory Nevada and Gigafactory Texas for ramp-ups of the Tesla Semi and Cybercab toward volume production, both targeted to commence in the first half of 2026. At the same time, preparations continue for production of the next-generation Roadster.
First-generation production lines for the Optimus humanoid robot are being installed at the Fremont plant in California, positioning the company for future volume production as part of its longer-term AI and robotics strategy.
In battery manufacturing, Tesla has begun producing battery packs for certain Model Y vehicles using its in-house 4680 cells. This move is intended to mitigate supply chain challenges linked to trade barriers and tariff risks. The company can now produce dry-electrode 4680 cells with both anode and cathode manufactured in Austin, Texas, and expects domestic cathode material production in Texas along with LFP lines in Nevada to begin operations in 2026.
In the fourth quarter, total revenue declined 3% year-on-year to USD 24.9 billion. Automotive revenue fell more sharply, down 11% to USD 17.7 billion. Tesla operating income decreased 11% year-on-year to USD 1.4 billion, while operating margin narrowed to 5.7% from 6.2% in the same period last year. Adjusted EBITA slipped 4% to USD 4.2 billion, and net income dropped to USD 0.8 billion, reflecting a 61% decline.
For the full year 2025, total revenue came in at USD 94.8 billion, down 3% compared with the prior year. Automotive revenue declined 10% to USD 69.5 billion, while Tesla operating income fell 38% to USD 4.4 billion. Operating margin contracted significantly to 4.6% from 7.2% a year earlier. Adjusted EBITA decreased 9% to USD 14.6 billion, and net income declined 46% to USD 3.8 billion.
Vehicle production and deliveries performance
During Q4 2025, Tesla produced 434,358 vehicles, representing a decline of approximately 5% year-on-year. Of this total, 422,652 units were Model 3 and Model Y, while 11,706 units came from other models.
Vehicle deliveries in the quarter totaled 418,227 units, down around 16%. Model 3 and Model Y accounted for 406,585 deliveries, with the remaining 11,642 units attributed to other models.
Across the full year, Tesla produced 1,654,667 vehicles, a decrease of roughly 7% compared with the previous year. Model 3 and Model Y represented the majority at 1,600,767 units, while other models contributed 53,900 units.
Total deliveries for 2025 reached 1,636,129 units, down approximately 9%. Of these, 1,585,279 units were Model 3 and Model Y, and 50,850 units were other models.
Energy storage, manufacturing, and technology roadmap
Tesla recorded its highest-ever quarterly energy storage deployments in Q4, reaching 14.2 GWh, supported by record Megapack deployments. The company plans to begin Megapack 3 and Megablock production at Megafactory Houston in 2026, underscoring the growing role of energy storage in its business mix.
Preparations are ongoing at Gigafactory Nevada and Gigafactory Texas for ramp-ups of the Tesla Semi and Cybercab toward volume production, both targeted to commence in the first half of 2026. At the same time, preparations continue for production of the next-generation Roadster.
First-generation production lines for the Optimus humanoid robot are being installed at the Fremont plant in California, positioning the company for future volume production as part of its longer-term AI and robotics strategy.
In battery manufacturing, Tesla has begun producing battery packs for certain Model Y vehicles using its in-house 4680 cells. This move is intended to mitigate supply chain challenges linked to trade barriers and tariff risks. The company can now produce dry-electrode 4680 cells with both anode and cathode manufactured in Austin, Texas, and expects domestic cathode material production in Texas along with LFP lines in Nevada to begin operations in 2026.
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