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4d ago

Tesla Reports Steep Q2 Decline as Musk Warns of Rough Quarters Ahead

Expiring federal tax credits, new tariffs and a steep drop in sales have pushed Tesla toward a cheaper model ramp-up; it is also expanding paid robotaxi trials.

FILE PHOTO: BYD Dolphin Surf electric cars at a vehicle presentation event in Berlin, Germany May 21, 2025. REUTERS/Annegret Hilse/File Photo
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Overview

  • Tesla’s Q2 revenue fell 12% year-on-year to $22.5 billion and net profit dropped 16% to $1.2 billion.
  • Global deliveries slid 13.5% to 384,122 vehicles, hurt by the looming end of the $7,500 federal EV credit and intensifying rival offerings.
  • The company absorbed approximately $300 million in extra costs from President Trump’s 25% auto import tariffs and saw regulatory credit revenue more than halve to $439 million.
  • Tesla began building a more affordable model in June and aims to start volume production in the second half of 2025.
  • Elon Musk cautioned that Tesla “could have a few rough quarters” before autonomy and AI services drive a turnaround, and shares fell about 8% in early trading.