The stock ended the after-hours session up $12.83 (+5.39%) at $250.80 after trading up $10.47 (+4.60%) during the regular session run-up to the release.
From Investing.com, April 22:
Tesla Inc. (TSLA) reported its Q1 2025 earnings, missing both earnings per share (EPS) and revenue forecasts. The company posted an EPS of $0.27, falling short of the $0.42 forecast, and reported revenue of $19.34 billion, below the expected $21.4 billion. This performance comes as InvestingPro data shows 11 analysts have recently revised their earnings expectations downward. Despite these misses, Tesla’s stock surged 9.94% in aftermarket trading, closing at $250.11, up from the previous close of $227.50. With a market capitalization of $763.57 billion, Tesla remains a dominant force in the automotive sector.
Key Takeaways
- Tesla missed both EPS and revenue expectations for Q1 2025.
- Stock rose 9.94% in aftermarket trading, indicating positive investor sentiment.
- Record gross profit in energy storage business despite challenges in auto margins.
- Significant progress in autonomous vehicle and robot development initiatives.
Company Performance
Tesla’s Q1 performance was mixed, with notable achievements in its energy storage segment offset by challenges in its automotive division. The company experienced a decline in auto margins due to reduced deliveries and factory updates. However, Tesla’s commitment to innovation remains strong, with significant advancements in autonomous technology and robot development.
Financial Highlights
- Revenue: $19.34 billion, below the forecast of $21.4 billion.
- Earnings per share: $0.27, missing the forecast of $0.42.
- Record gross profit achieved in the energy storage business.
Earnings vs. Forecast
Tesla’s actual EPS of $0.27 fell short of the $0.42 forecast, marking a significant miss. Revenue also fell short by $2.06 billion, indicating operational challenges or market pressures.
Market Reaction
Despite missing earnings expectations, Tesla’s stock rose significantly in aftermarket trading, indicating that investors are optimistic about the company’s future prospects. The stock’s current price of $250.11 is a notable increase from its pre-earnings close of $227.50.
Outlook & Guidance
Tesla remains optimistic about its future, with plans to launch its Robotaxi in Austin in June and ongoing development of its Optimus humanoid robot. The company is targeting millions of autonomous vehicles by the second half of 2025 and aims to produce 1 million Optimus units annually by 2029.
Executive Commentary
Elon Musk, CEO, emphasized the importance of large-scale autonomous cars and robots, stating, "The future of the company is fundamentally based on large scale autonomous cars and large volume vast numbers of autonomous humanoid robots." Dev Ateneja, CFO, added, "We’re not just developing the software solution. We are also manufacturing the cars."
Risks and Challenges
- Decline in auto margins due to factory changes and reduced deliveries.
- Increased operating expenses from AI and vehicle program initiatives.
- Economic uncertainties impacting the EV market.
- Potential challenges from tariffs, especially in the energy storage segment.
Q&A
During the earnings call, analysts inquired about the pricing and future capabilities of Tesla’s Full Self-Driving (FSD) technology, supply chain resilience, and the impact of tariffs. The company addressed these concerns, highlighting its strategic focus on innovation and market expansion.
Full transcript - Tesla Inc (TSLA) Q1 2025:
Travis Saxarod, Head of Investor Relations, Tesla: Good afternoon, everyone, and welcome to Tesla’s first quarter twenty twenty five Q and A webcast. My name is Travis Saxarod, Head of Investor Relations, and I’m joined today by Elon Musk, Dev Ateneja, and a number of other executives. Our Q1 results were announced at about three p. M. Central Time and the update deck will be published to the same link as this webcast.
During this call, we will discuss our business outlook and make forward looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in our most recent filings with the SEC. During the question and answer portion of today’s call, please limit yourself to one question and one follow-up. Please use the raise hand button to join the question queue.
Before we jump into q and a, Elon will be providing an update.
Elon Musk, CEO, Tesla: Elon? Hello, everyone. Well, it’s never a dull moment these days. Well, thanks for sure. Every day is gonna be exciting.
As so people know, there’s been some blowback for the time that I’ve been spending in government with the Department of Government Efficiency or Doge. I think the work that we’re doing there is actually very important for kind of rein in the insane deficit that is leading our country, United States to destruction. And the Doge team has made a lot of progress in addressing waste and fraud. But natural blowback from that is those who were receiving the wasteful dollars and the fortunate dollars will try to attack me and Doge team and anything associated with me. So but then I’m really left with two choices.
Should we just let the waste and fraud continue? And I was continuing at it to to grow at a really unsustainable pace that was bankrupting the country or to fight the ways and forward and try to get the country back on the right track. And I I believe the the right thing to do is to just fight the ways and forward and get the country back in the right track and working together with the president Trump and his administration. Because if the ship of America goes down, we all go down with it, including Tesla and everyone else. So I think this is this critical work.
Now the the protests that you’ll see out there, they’re very organized. They’re paid for. They’re they’re they’re obviously not going to say admit that the reason that they’re protesting is because they’re receiving fraudulent money or or that they’re the recipients of wasteful largesse, but gonna they’re gonna come up with some other reason. But that is the the the real reason for the protests. The actual reason is that the the is that those receiving the waste and fraud wish to continue receiving it.
That is the real thing that’s going on here, obviously. So now that said, I I I do think there’s you know, the the the large slug of work necessary to get the votes team in place and working in the government to get the financial house in order is mostly done. And I think starting probably in next month, May, my time allocation to Doge will drop significantly. I’ll I’ll have to continue doing it for I think we’ll play it the remainder of the president’s term just to make sure that the waste and fraud that we stop does not come roaring back, which we’ll do if if it has the chance. So so I think I’ll I’ll continue to spend, you know, a day or two per week on government matters for as long as the president would like me to do so and as long as it is useful.
But starting next month, I’ll be allocating far more of my time to Tesla and now that the the major work of establishing the Department of Government Efficiency is done. So at Tesla, we’ve gone through many many of crisis over the years and actually been through many near the many near death experiences. Like, we’re probably we’re on the ragged edge of death at least on maybe a dozen times. It’s been so so many times. This is not one of those times.
We’re not on the ragged edge of death. Not even close. So but but, you know, there are some there are some challenges, and I expect that this year will be there’ll probably be some unexpected bumps this year. But I remain extremely optimistic about the future of the company. The future of the company is fundamentally based on large scale autonomous cars and and and and large scale in large volume vast numbers of autonomous humanoid robots.
So the the value of a company that that makes truly useful autonomous humanoid robots and autonomous useful vehicles at scale at low cost, which is what Tesla’s gonna do, is staggering. I I continue to believe that Tesla, with excellent execution, will be the most valuable company in the world by far. But that’s an important if. We must execute well. But if we do execute well, I do I think Tesla will be the most valuable company in the world by far.
It may may be as valuable as the next five companies combined. So but there’ll be a few bumps along the road before before that happens. I said, I think, on the last earnings call that, you know, that we’ll we’ll start to see the prosperity of autonomy take effect in a material way around the middle of next year. We still expect we expect to have these be selling fully autonomous rides in June in Austin as as we’ve been saying for now several months. So that that’s continued.
But the real question from financial standpoint is when does it really become material and affect the bottom line of the company and and start to be a fundamental part of the of of of the of the when when does it move the financial needle in a significant way? That’s probably around the middle of next year, second half of next year. And then once it does not move the move the national needle in a significant way, it will really go exponential from there. So that’s I’d encourage people to look beyond, like, the, you know, some sort of bumps and potholes of the road immediately ahead of us, but left your gaze to the bright shining, you know, sort of down on a hill. I don’t know.
Some imagery. And that’s where we’re headed. And not not not too distant future, like I said, and the next year or two. So let’s see. With respect to supply chain risk, something that that something that Tesla has been working on for several years is to localize supply chains.
Does it actually make sense from a a cost standpoint, from a and and from a logistics risk standpoint, is is to have have the supply chains be at least located on the continent in which the car is built. And so we are, I think, the least a company the least affected car company with with respect to tariffs, at least in my most respects. I mean, it remains to be seen. Now now tariffs are still, you know, tough on a company when margins are still low, but we we do have localized supply chains in both America, Europe, and China. So that’s that puts us in a stronger position than any of our competitors.
And I I undoubtedly, I’m gonna get a lot of questions about tariffs. And I I I just wanna emphasize that this this the tariff decision is entirely up to the president of The United States. I will weigh in with my advice with the president, which he he will listen to my advice, but then it’s up to him, of course, to make his decision. I I’ve been on the record many times saying that I believe lower tariffs are generally a good idea for prosperity, but this decision is fundamentally up to the elected representative of the people being the president of The United States. So, you know, I’ll continue to advocate for lower tariffs rather than higher tariffs, but that’s all I can do.
So now now let me walk you through why I’m so excited about the future of Tesla. So first of all, autonomy. The team and I are laser focused on bringing robotaxi to Austin, New Jersey. Unsupervised autonomy will first be solved for for for the Model y in in Austin. And then it it actually, we should parse out the terms for robotic taxi or robot taxi and just generally, like, what’s the the cyber cab because we’ve got a product called the cyber cab.
And then if any any Tesla, which could be an s three x or y that is autonomous, is a robotic taxi or robotaxi. It’s very confusing. So the vast majority of of of the Tesla fleet that we’ve made is capable of being a robotaxi or robotic taxi. And as we’re we’re going from once we can make the whole system work where you can have paid rides fully autonomously with no one in the car in in one city, that that that is a very scalable thing for us to go broadly within what with whatever jurisdiction allows us to to operate. So because what what we’re solving for is a general solution to autonomy, not not a city specific solution for autonomy, Once we make it work in a few cities, we can basically make it work in all cities in that in in that legal jurisdiction.
So if it’s once we can make it based to work in a few cities in America, we can make work anywhere in America. Once we can make work in a few studies in China, we make work anywhere in China, likewise in Europe, limited only by regulatory approvals. So this is the advantage of having a generalized solution using artificial intelligence and the an AI chip that Tesla designed specifically for this purpose as opposed to very expensive sensors and high precision maps of a particular neighborhood where that neighborhood may change or often changes, and then the cost of stops working. So we have a general solution instead of a a specific solution. Yeah.
And we’ve got Optimus. We’re making good progress in Optimus. We expect to have thousands of of Optimus robots working in Tesla factories by the end of this year, doing this more. And we expect to scale Optimus up faster than any product, I think, in history to get to millions of units per year as soon as possible. I I I think feel confident in getting to a million units per year in less than five years, maybe four years.
So but, you know, twenty twenty thirty, I feel confident in predicting a million OPTIMA’s units per year. It might be 2029. So let’s see. With respect to energy, our energy business is doing very well. The Megapack is enables utility companies to output far more total energy than would otherwise be the case.
When you think of the the energy capability of a grid, it’s much it’s much more than, let’s say, say, total energy output per year. If is if if if a power plants could operate at peak power for all twenty four hours as opposed to being at half power, sometimes a quarter power at night, then you could double the energy output of existing power plants. But in order to do that, you need to buffer the energy so that you can charge up the something like battery pack at night and then discharge into the grid during the day. So this is a massive unlock on total energy output of any given grid over the course of the year. And utility companies are beginning to realize this and are are buying in our mega packs at scale.
So at at this point, a gigawatt class battery is quite a common thing. So we have many orders in the hopper for gigawatt and beyond batteries. And we we expect the energy the the stationary energy storage business to scale ultimately to terawatts per year. So very, very good numbers. Now q one you know, first quarters of of a year are are usually pretty tricky because it’s it’s usually the worst quarter of the year because people don’t wanna go buy a car in the middle of winter during a blizzard.
So and and and this so so we we picked q one as, like, a good quarter to do a a cut over to the new version of the Model y....
....MUCH MORE, the Q&A was interesting as always, less sycophantic than most.
