Tesla Profits Drop By 71%!

Tesla’s sales figures have put the company closer to the red than it has been in years. The electric automaker reported $409 million in net income on $19.3 billion in revenue after delivering almost 337,000 EVs in the first quarter of the year. The company’s net income reflects a 71% drop from the same quarter last year. It was the worst quarter for Tesla deliveries in more than two years and came on the heels of the company’s first-ever year-to-year drop in sales. Tesla’s income was buffered by selling $595 million in zero-emissions tax credits, according to its earnings report — without those, it would have posted a massive loss. 

Tesla also cautioned shareholders about how the trade war may affect its business moving forward. The company said President Trump’s tariffs and “changing political sentiment” could have a “meaningful impact on demand for our products.” The company noted the current tariffs, the bulk of which are directed at China, will have “a relatively larger impact on our Energy business compared to automotive.” Tesla said it is taking actions to stabilize the business in the medium to long term. Tesla is sticking to its ambitious plans to make more affordable models. 

The new vehicles will use aspects of a next-generation platform that powers the robotaxi, but will rely on its existing one that powers the Model Y and Model 3, the company said. As such, these cheaper vehicles will be produced on the same manufacturing lines as the current vehicle lineup. 

The company’s EV lineup is aging (though the sedans and SUVs have now all gotten face-lifts) and its newest product, the Cybertruck, is nowhere near the hit that CEO Elon Musk thought it could be. And Musk’s far-right politics, along with his involvement in the Trump administration, have created a sizable backlash to Tesla’s brand.  At the same time, Musk has oriented the company toward its Robotaxi and Optimus robot projects.  

Much of its (Tesla) future will depend on Musk’s antics within the Trump administration. Even if he leaves the US Government, it is tough for him - no one believes in what Tesla stands for in the end, he may have to sell the company to some other US carmaker! 

References:

Tesla profits drop 71% on weak sales and anti-Elon Musk sentiment, Sean O'Kane, Kirsten Korosec, TechCrunch, 22 April 2025

 

World EV Sales Report 2025, CleanTechnica