After the U.S. stock market closed on April 22 local time, Tesla released its first - quarter 2025 earnings report. The report showed that its revenue in the first quarter was $19.335 billion, a year - on - year decrease of 9.2% and lower than market expectations. The net profit was $409 million, a year - on - year decline of 71%, also falling short of market expectations. If the carbon credit income of $595 million is excluded, it would actually record a loss.
The decline in vehicle deliveries was the main reason for the revenue slump. A total of 336,681 vehicles were delivered in the first quarter, a year - on - year decrease of 13%, marking the worst quarterly performance since 2022.
Behind the under - performance of the earnings is related to the "reputation impact" brought by Tesla CEO's role in the Trump administration. The CEO said that in May, he would reduce the involvement in government affairs and put more energy back into Tesla.
Deliveries Drop 13%, Hitting a New Low Since 2022
Tesla delivered 336,681 vehicles globally in the first quarter, a year - on - year decline of 13%, reaching a new low since 2022. The European market was particularly hard - hit (for example, sales in Germany dropped by 62%), and the wholesale volume in China decreased by 21.8% year - on - year.
As the head of the "Department of Government Efficiency" in the Trump administration, the CEO's political activities have distracted his attention and triggered boycotts from European consumers, directly hitting sales. The damage to the brand reputation caused by his political stance has exacerbated the market trust crisis.
A recent survey showed that about half of Americans hold a negative view of the CEO, and 47% of the respondents have a negative view of Tesla.
At the earnings conference, the CEO announced that starting from May this year, he would significantly reduce the involvement in government affairs and focus on Tesla's operations.
Tariff Policies Will Affect Tesla's Supply Chain
In addition, the uncertainty of Trump's tariff policies is disrupting Tesla's supply chain. The tariff policy on auto parts will take effect on May 3, which has troubled many U.S. automakers including Tesla. Six major groups in the U.S. auto industry have written letters to the Trump administration, opposing this tariff policy.
The CEO said that although Tesla is a highly vertically integrated automaker, the company still sources a large number of parts and materials from countries outside the United States. Therefore, he advocates for lower tariffs.
Currently, the gross profit margin of Tesla's automotive business has dropped to 12.5%. If Trump's tariff hikes continue, it will further squeeze Tesla's profit margin, and the energy storage business that relies on the Chinese supply chain will also be more severely impacted.
