Tesla Inc (NASDAQ:TSLA) shares added 3% afterhours on Thursday after the electric-vehicle maker reported fourth-quarter 2025 earnings that topped Wall Street expectations, despite year-over-year declines in sales and profit.
Tesla reported non-GAAP earnings per share of $0.50 for the quarter ended December 31, beating analyst estimates of $0.45.
Revenue for the quarter came in at $24.9 billion, slightly above consensus expectations of $24.7 billion, though down from $25.7 billion in the same period a year earlier.
Automotive revenue declined 11% year over year in the fourth quarter to $17.7 billion, reflecting lower vehicle volumes and pricing pressure.
Energy generation and storage revenue rose 25% to $3.84 billion, while services and other revenue increased 18% to $3.37 billion.
Gross margin was a bright spot in the quarter. Tesla reported a total GAAP gross margin of 20.1%, exceeding analyst expectations of roughly 17.1% and improving from 16.3% a year earlier.
Annual vehicle deliveries declined 8.6% to between 1.63 million and 1.64 million units. This saw full-year profit fell sharply to $3.8 billion, down 46% from 2024.