Tesla sealed a second consecutive year of declining profits in its fourth-quarter earnings report Wednesday, as the electric carmaker navigates a perhaps unprecedented backdrop with its CEO Elon Musk shaping the Trump administration while the company pursues the potential trillion-dollar opportunity of fully autonomous driving.
Tesla CEO Elon Musk at Trump's inauguration.
Tesla brought in $25.7 billion of sales last quarter and $0.73 adjusted earnings per share, both far below consensus analyst estimates of $27.3 billion in sales and $0.77 earnings per share, according to FactSet.
The final earnings release of 2024 finalized another difficult year for Tesla’s bottom line, as its full-year net income came in at $8.4 billion, a 23% decrease from 2023 and a 40% decline from 2022’s record $14.1 billion profit.
Tesla’s full-year revenue rose $97.7 billion, a 1% improvement from 2023’s record.
But Tesla expects its core vehicle business to “return to growth” in 2025, the company said in its earnings presentation.
The company also announced it plans to begin production next year on its "Cybercab" driverless taxi vehicle.
After declining 2% in regular trading to a more than three-week low closing price of $389, Tesla shares dropped a further 5% following the earnings release.
In an earnings call last January, Musk characterized the shrinking bottom line as Tesla moving “between two major growth waves,” an assertion agreed upon by Wall Street. Analysts project a more than 80% increase in Tesla’s free cash flow in 2025 and a further 50% jump in 2026. Earlier this month Tesla announced it delivered about 496,000 vehicles in the fourth quarter, bringing its full-year deliveries to 1.79 million cars, marking the first year-over-year decline since at least 2016. Despite the stalling deliveries and profits, Tesla stock rose throughout 2024 and early 2025, as its share price is up more than 100% over the last 12 months. In addition to hype about Tesla’s advancements in artificial intelligence, including its upcoming driverless taxis and humanoid Optimus robots, Tesla benefited from a sharp, positive reaction from investors to Trump’s victory, with shares up more than 50% since Election Day. Analysts say Tesla will likely benefit from looser regulations under Trump, who Musk enjoys an extremely close relationship with, speaking at his inauguration and donating more than $200 million toward his election efforts. The always controversial Musk has landed in hot water for his right-wing activism, most notably performing a gesture at the inauguration that some characterized as a Nazi salute.
If Musk addresses some shareholders’ conflict of interest concerns on the Q4 earnings call. The Tesla shareholders forum used for earnings call questions include more than 100 questions on Musk, including ones asking how Musk’s role in the White House cuts into time with Tesla and if Tesla has lost sales due to Musk’s outspoken views.
Musk is by far the richest person on the planet with a net worth of more than $410 billion, according to our latest estimates. Tesla is the biggest contributor to his fortune, as his 13% extant equity stake is worth more than $160 billion with another 9% equity bonus award for Musk pending appeal, with Musk’s stakes in his other companies including generative AI startup xAI and aerospace and communications firm SpaceX making up most of the rest of his fortune.