Tesla experienced a decline in revenue from its electric vehicle operations in the first quarter compared to the previous year. The company, led by CEO Elon Musk, reported automotive revenue of $13.97 billion for the first three months of 2025, reflecting a decrease of approximately 20% from the same period in the previous year, according to their earnings report.
During an earnings call, Elon Musk mentioned that his focus on the Department of Government Efficiency (DOGE) would significantly decrease. DOGE has been one of Musk’s initiatives during the early days of the second Trump administration.
Tesla’s total revenue, which includes automotive, energy generation and storage, and services and other revenue, reached $19.3 billion for the first quarter, showing a 9% decrease compared to the first quarter of the previous year.
The company attributed the drop in total revenue partially to fewer vehicle deliveries, which were affected by the Model Y update across all four vehicle factories, as well as a reduced average selling price due to sales incentives and other factors.
Earlier in the month, Tesla, facing protests and unrest linked to Musk’s involvement in DOGE, reported vehicle deliveries of 323,800 for the first quarter, down from 386,810 deliveries in the same period the previous year.
For the segment of energy generation and storage, Tesla generated $2.73 billion in revenue, marking a 67% increase year over year. Additionally, revenue from services and other sources grew 15% to nearly $2.64 billion in the first quarter.
Tesla highlighted growing uncertainty in the automotive and energy markets, which is being impacted by rapidly changing trade policies affecting global supply chains and cost structures.
In terms of financial performance, Tesla reported a quarterly net income of $409 million, with diluted earnings per share at $0.27. These figures represented declines of 71% and 40%, respectively, as noted in the earnings report.
Tesla’s operating margin decreased by 343 basis points year-over-year, reaching 2.1% in the first quarter.
In its guidance, Tesla acknowledged the challenges of assessing the effects of shifting global trade policies on its automotive and energy supply chains, cost structure, and demand for durable goods and related services.
While the company continues to invest strategically in its vehicle and energy sectors, the growth rate for the current year will depend on various factors, including progress in autonomy efforts, production ramp-up at its factories, and the broader macroeconomic environment.
Tesla remains on schedule to commence production of new vehicles, including more affordable options, in the first half of the year. The current vehicle lineup includes the Model S, Model 3, Model Y, Model X, Cybertruck, and electric semi-trucks.
