Tesla Inc delivered weaker-than-expected first-quarter results after market close on Tuesday, missing consensus estimates on both revenue and earnings.
The electric vehicle manufacturer recorded a 71% decline in net income to US$409 million (A$642 million) for the March quarter, representing its weakest quarterly profit since 2020. Revenue fell 9% year-on-year to US$19.3 billion, significantly missing market expectations.
Despite the underperformance, the electric vehicle (EV) maker’s shares rose nearly 5% in after-hours trading. The rally followed comments from Chief Executive Elon Musk, who indicated he would shift more of his attention back to Tesla from next month.
“I think starting probably next month, May, my time allocation to DOGE [the Department of Government Efficiency] will drop significantly,” he said in a conference call.
The company had warned investors prior to the call that “uncertainty in the automotive and energy markets continues to increase as rapidly evolving trade policy adversely impacts the global supply chain and cost structure of Tesla and our peers”.
Analyst sentiment was also muted before the call.
"It’s been a rollercoaster 2025 for Tesla shareholders, and we’re only four months in. Shares are down 44% year to date, making it the worst-performing Magnificent Seven stock. For the first time in over four years, Tesla has lost its place as the most widely held stock by eToro’s Australian users, being leapfrogged in Q1 by Nvidia,” eToro market analyst Josh Gilbert said before the meeting.
“Investors have started to lose patience with the EV giant due to poor vehicle deliveries, auto tariffs and visionary CEO, Elon Musk, taking his eye off the ball from Twitter to SpaceX to DOGE. This has fuelled consumer backlash, with reports of protests at Tesla showrooms and declining brand loyalty in key markets.
“At the start of April, Tesla handed down its worst quarterly vehicle deliveries in two years, with Q1 showing a 13% decline to 336,681 vehicles, far lower than the 390,000 expected.”
Investors appeared to brush off the earnings miss, focusing instead on Musk’s renewed commitment to Tesla and its long-term strategy.
Supporters of Elon Musk believe the company is nearing a new phase of growth, driven by plans to launch a self-driving taxi service using a next-generation vehicle in Austin, Texas, as early as June.
Musk has also pledged to commence production of the humanoid Optimus robot before the end of the year. The bipedal robot is intended to carry out routine or hazardous tasks.