Tesla (NASDAQ:TSLA) delivered one of its worst earnings reports to date, missing revenue estimates by approximately 9% and falling short on EPS by 34%. The decline was largely driven by double-digit drops in both production and deliveries within the Automotive segment. Notably, this comes at a time when global EV sales are rising—highlighting that Tesla’s challenges are not market-driven but company-specific. Growth in Energy Generation and Storage, along with Services and Other, provided some support to overall metrics, but not nearly enough to offset the broader weakness.
The core issue remains brand deterioration, largely attributed to CEO Elon Musk’s increasingly polarizing public persona and political engagement, particularly on his platform X (formerly Twitter). During the earnings call, Musk addressed the criticism and announced he would scale back his time at the Department of Government Efficiency (DOGE) to refocus on his CEO duties at Tesla.
Little meaningful detail was offered on Tesla’s key future growth drivers—the robotaxi program, Optimus, and the long-promised affordable models. Commentary appeared to confirm that the new models are essentially stripped down versions of current vehicles. Musk reiterated that the robotaxi service will launch in Austin this June, though it will rely on existing Model Ys with in-vehicle drivers placing the cars in FSD mode—far from the fully autonomous fleet once envisioned. He also again promised that unsupervised FSD will launch “later this year”.
As for Optimus, while Musk reaffirmed production targets of about 1,000 units by year-end and millions by 2030, he emphasized that the project is still in development—walking back earlier comments that implied faster timeline. No specifics were given on its capabilities or what tasks they are performing at Tesla today.
Overall, Tesla’s financial health is showing visible strain. Demand is weakening, the core revenue engine is under pressure, and investor confidence is wavering. Musk’s recommitment to Tesla may not be reassuring, given his central role in the brand’s deterioration. With net income plunging 70% and continued absence of meaningful board oversight, shareholders and prospective investors should be deeply concerned.
For more details, key highlights, and commentary, check out the high-level earnings summary.
