Tesla Releases Third Quarter 2025 Financial Results

Rhea-AI Summary

Tesla (NASDAQ: TSLA) reported Q3 2025 results on October 22, 2025 showing record vehicle deliveries and record energy storage deployments, driving total revenue of $28.095B (+12% YoY) and record free cash flow of $3.990B. GAAP net income was $1.373B (diluted EPS $0.39); non-GAAP net income was $1.770B (diluted EPS $0.50).

Operational highlights: 497,099 deliveries (+7% YoY), storage deployed 12.5 GWh (+81% YoY), cash and investments of $41.647B. The company cited higher operating expenses, stock-based comp, and lower regulatory/FSD revenue as headwinds while noting AI, Robotaxi, Cybercab, Semi, and Megapack 3 production plans for 2026.

Positive

• Total revenue $28.095B (+12% YoY)
• Free cash flow $3.990B (record)
• Total deliveries 497,099 (+7% YoY)
• Energy storage deployed 12.5 GWh (+81% YoY)
• Cash and investments $41.647B (up $4.9B sequentially)

Negative

• Operating income down 40% YoY to $1.624B
• Operating margin compressed to 5.8% from prior year
• Headwinds from higher operating expenses and stock-based compensation
• Lower regulatory credit and reduced one-time FSD revenue recognition

Insights

Equity Analyst

Mixed quarter: record revenue and free cash flow, but sharply lower operating income and margin compression.

Tesla posted $28.095B revenue (+12% YoY) and record free cash flow of $3.990B, driven by higher deliveries (497,099 units) and record energy storage deployments (12.5 GWh). Cash and investments rose to $41.647B, supporting stated funding for product and capacity plans.

Operating income fell 40% to $1.624B, yielding a 5.8% operating margin, pressured by higher operating expenses, stock-based compensation, restructuring charges, and lower regulatory and one-time FSD revenue. These expense items reduced near-term profitability despite top-line strength.

Watch execution and timing on planned manufacturing and energy milestones. Key near-term monitors include the Texas lithium refinery start in Q4 2025, LFP line ramp in Q1 2026, and 2026 volume-production targets for Cybercab, Tesla Semi and Megapack 3. Also track sequential operating expense trends and any changes to FSD revenue recognition in coming quarters.

Tesla Inc. (Nasdaq: TSLA) reported third quarter 2025 results showing record vehicle deliveries and record energy storage deployments, which the company said drove record quarterly revenue and free cash flow. Total revenue rose 12% year over year to $28.095B, while free cash flow reached $3.990B. GAAP net income was $1.373B and diluted GAAP EPS was $0.39; on a non-GAAP basis, net income was $1.770B with diluted EPS of $0.50, according to the shareholder update published on October 22, 2025.

Financial performance

According to the financial summary table on page 4, Tesla’s GAAP gross profit was $5.054B with a total gross margin of 18.0%. Operating income declined 40% year over year to $1.624B, resulting in a 5.8% operating margin. Adjusted EBITDA, a non-GAAP metric, was $4.227B, representing a 15.0% margin. The company ended the quarter with cash, cash equivalents and investments of $41.647B, up $4.9B sequentially, which Tesla attributed primarily to higher free cash flow.

Metric (Q3 2025)	Result
Total revenue	$28.095B (12% YoY)
GAAP gross margin	18.0%
Operating income / margin	$1.624B / 5.8%
GAAP net income	$1.373B (diluted EPS $0.39)
Non-GAAP net income	$1.770B (diluted EPS $0.50)
Adjusted EBITDA	$4.227B (15.0% margin)
Operating cash flow	$6.238B
Capital expenditures	$2.248B
Free cash flow	$3.990B (record)
Cash and investments	$41.647B

All figures above are drawn from the company’s unaudited financial summary and statements.

Drivers of change

The company said revenue growth reflected higher vehicle deliveries and growth in Energy Generation and Storage as well as Services and Other, partially offset by lower regulatory credit revenue and lower one-time Full Self-Driving (FSD) revenue recognition versus the prior year. Operating income was pressured by higher operating expenses, increased stock-based compensation and restructuring charges, lower regulatory credit revenue, reduced one-time FSD recognition, and a higher average cost per vehicle tied to lower fixed-cost absorption for certain models, increased tariffs and sales mix. These headwinds were partially offset by growth in energy and services gross profit and higher deliveries.

Operational results and segments

The operational summary on page 6 shows total deliveries of 497,099 vehicles in Q3 2025, up 7% year over year. Model 3/Y deliveries were 481,166 (9% YoY), while deliveries of other models were 15,933. Global vehicle inventory ended the quarter at 10 days of supply, and total production was 447,450 units. Storage deployed reached 12.5 GWh, an 81% year-over-year increase.

Automotive highlights

Tesla expanded its vehicle lineup with lower-priced entries and performance variants. In the U.S., the company launched Model 3 Standard and Model Y Standard, starting at $36,990 and $39,990 respectively, and introduced Model Y Performance with a stated 0-to-60 mph time of 3.3 seconds. The company also began leasing certified pre-owned Model 3 and Model Y vehicles. In China, Tesla launched the longer-wheelbase six-seat Model YL. The update notes additional market and software milestones, including ongoing efforts to obtain regulatory approval to launch FSD (Supervised) in Europe.

Core technology and AI

Tesla said it began deploying FSD (Supervised) v14 in October with improvements in complex driving scenarios and expanded its Robotaxi service area in Austin while launching a Bay Area ride-hailing service. The company announced a deal with Samsung to manufacture advanced semiconductors in the U.S. and said its AI training capacity reached 81,000 H100-equivalent GPUs on its Cortex infrastructure. The update also references the Robotaxi iOS waitlist and vehicle software enhancements such as Grok and Low Power Mode. Battery and powertrain notes include a new pack for the Model 3 and Model Y Standard, with the company highlighting continued supply-chain localization and plans for a Texas lithium refinery to begin production in Q4 2025 and LFP lines in Nevada to begin production in Q1 2026.

Energy and charging

The Energy Generation and Storage segment achieved record quarterly energy storage deployments, supported by Megafactory Shanghai and another record quarter for Powerwall. Tesla reported sequential and year-over-year increases in gross profit to $1.1B on a trailing basis. The company introduced Megablock, which integrates four Megapack 3 units into a pre-engineered medium-voltage package and targets faster utility-scale deployment. Tesla also highlighted v4 Supercharger cabinets with 3 times the power density and double the stalls per cabinet compared to v3, enabling up to 500 kW charging for passenger vehicles and 1,200 kW for Tesla Semi.

Outlook and guidance language

In its outlook section, Tesla cited uncertainty from shifting global trade and fiscal policies and broader macroeconomic factors. The company said it has sufficient liquidity to fund its product roadmap and capacity expansion and expects hardware-related profits to be accompanied over time by an acceleration of AI, software and fleet-based profits. Tesla stated that Cybercab, Tesla Semi and Megapack 3 remain on schedule for volume production starting in 2026, and that first-generation production lines for Optimus are being installed in anticipation of volume production.

How Tesla defines key non-GAAP metrics

Per the definitions in the release, free cash flow equals operating cash flow less capital expenditures. Adjusted EBITDA equals net income attributable to common stockholders before interest expense, provision for income taxes, depreciation, amortization and impairment, stock-based compensation expense and digital-asset gains or losses. Non-GAAP net income excludes stock-based compensation and digital-asset gains or losses, net of tax. These definitions are used by the company to supplement GAAP reporting.

Financial snapshot

Revenue mix (Q3 2025)	Amount
Automotive revenue	$21.205B
Energy Generation and Storage revenue	$3.415B
Services and Other revenue	$3.475B

Figures above are from the statement of operations.

This article is based solely on information provided in Tesla, Inc.'s press release and shareholder update dated October 22, 2025. The content is for informational purposes only and does not constitute financial, investment, legal, or tax advice. Stock Titan and its writers make no representations as to the accuracy, completeness, or timeliness of the information. Investors should conduct their own due diligence before making any investment decisions.

Source: Tesla, Inc.

FAQ

What were Tesla's Q3 2025 revenue and earnings per share (TSLA)?

Q3 2025 total revenue was $28.095B; GAAP diluted EPS was $0.39 and non-GAAP diluted EPS was $0.50.

How many vehicles did Tesla deliver in Q3 2025 and how did deliveries change year-over-year (TSLA)?

Tesla delivered 497,099 vehicles in Q3 2025, up 7% year-over-year.

What drove Tesla's record free cash flow in Q3 2025 (TSLA)?

Free cash flow reached $3.990B, driven by higher operating cash flow of $6.238B and capital expenditures of $2.248B.

How did Tesla's Energy Generation and Storage perform in Q3 2025 (TSLA)?

Energy storage deployments hit 12.5 GWh (+81% YoY) with trailing gross profit reported near $1.1B.

Why did Tesla's operating income decline in Q3 2025 (TSLA)?

Operating income fell due to higher operating expenses, increased stock-based compensation, restructuring charges, and lower regulatory/FSD revenue.

What liquidity position did Tesla report at the end of Q3 2025 (TSLA)?

Cash, cash equivalents and investments totaled $41.647B, up $4.9B sequentially.