Tesla just hit a milestone no one wanted to see - its second consecutive year of declining revenue and profits. The EV pioneer reported $840 million in net income on $24.9 billion in revenue for Q4 2025, marking a staggering 61% profit plunge from the same period last year. While the broader EV market surged 20% globally, Tesla's sales tumbled 8.5%, raising hard questions about whether Elon Musk's ambitious $1 trillion pivot to AI and robotics can reverse the company's fortunes.
Tesla just closed the books on a year it would rather forget. The electric vehicle maker reported $840 million in net income on $24.9 billion in revenue for the fourth quarter of 2025, according to earnings filed with the SEC. That's a 3% revenue decline and a brutal 61% profit crash compared to Q4 2024, when the company posted $2.3 billion in net income on $25.7 billion in revenue.
The numbers paint a stark picture of a company losing momentum while its market roars ahead. Global EV sales climbed 20% in 2025, according to Reuters research. But Tesla's sales slid 8.5% to roughly 1.6 million vehicles - enough to hand its crown as the world's top EV seller to China's BYD, which moved 2.26 million units.
Wall Street analysts had braced for bad news, predicting $24.79 billion in revenue according to LSEG estimates compiled by CNBC. Tesla slightly beat that target, but the full-year picture remains grim: $3.8 billion in net income on $94.8 billion in revenue, down 3% from 2024.
The Q4 numbers were particularly ugly. Customer deliveries plunged 15.6% in the quarter as buyers rushed to complete purchases in Q3 to catch expiring federal tax credits before they disappeared. That timing issue created a demand cliff Tesla couldn't climb back from.
