TSLA: FY25 Deep Dive
First revenue decline in over a decade. Automotive -10%, regulatory credits -28%, Energy +27%. Operating margin compressed to 4.6%. Sell-side PT dispersion spans $24.86 to $600.
Key Takeaways
Tesla closed fiscal 2025 (calendar year ended December 31, 2025) at $94.8 billion of revenue, down 2.9% year-over-year — the first annual revenue decline in Tesla's public-company history. Automotive revenue fell 9.8% to $69.5 billion as global deliveries came in at approximately 1.64 million vehicles (down from the prior year's ~1.79 million), while regulatory credit revenue collapsed 28% to $2.0 billion as US EV credit rules rolled back. The offset was Energy generation and storage, which grew 27% to $12.8 billion on 46.7 GWh of storage deployments — the segment is now 13.5% of revenue and growing at roughly twice the absolute-dollar pace of the Auto shrink. Operating margin compressed to 4.6% (from 7.2% in FY24), operating income of $4.4 billion was Tesla's lowest since FY21, and free cash flow held at $6.2 billion on lower capex intensity. The sell-side spread is the widest of any mega-cap: 14 analysts, 8 Buy / 4 Hold / 2 Sell, median price target $420, range $24.86 (GLJ Research, reinstated Sell) to $600 (Wedbush).
Main business structure
Three revenue buckets per the 10-K disaggregation:
| Revenue line | FY25 ($M) | % of Total | FY24 ($M) | YoY |
|---|---|---|---|---|
| Automotive | 69,526 | 73.3% | 77,070 | -9.8% |
| — Automotive sales | 65,821 | 69.4% | 72,480 | -9.2% |
| — Regulatory credits | 1,993 | 2.1% | 2,763 | -27.9% |
| — Automotive leasing | 1,712 | 1.8% | 1,827 | -6.3% |
| Energy generation & storage | 12,771 | 13.5% | 10,086 | +26.6% |
| — Storage sales (Megapack / Powerwall) | 12,270 | 12.9% | 9,564 | +28.3% |
| — Energy leasing | 501 | 0.5% | 522 | -4.0% |
| Services and other | 12,530 | 13.2% | 10,534 | +18.9% |
| Total | 94,827 | 100% | 97,690 | -2.9% |
Tesla's segment reporting consolidates all Automotive into one line and all Energy into another — the 10-K does not separately disclose Model S / X / 3 / Y / Cybertruck revenue, but vehicle delivery counts run through the Q4 shareholder letter. FY25 delivered approximately 1.64 million consumer vehicles globally.
Geographic mix. Tesla discloses revenue by country of sale: US roughly 48%, China ~23%, other international ~29%. Proportions shifted modestly toward US in FY25 as China competition intensified. The 10-K does not disclose a Cybertruck-specific revenue line but Model Y remains the volume leader by a wide margin.
Customer concentration. No single customer / dealership accounts for 10% disclosure — Tesla sells direct to end consumers and to business fleets fragmented across thousands of accounts. Energy storage has more concentrated customers (utilities, IPPs, large commercial deployments) but no single 10%+ line in the 10-K.
Scale anchors. Global vehicle fleet cumulative deliveries crossed 8 million units during FY25. Supercharger network expanded to 72,000+ stalls globally, now also serving NACS-adopting OEMs. Energy storage deployment run-rate exited FY25 at over 50 GWh annualized. Four gigafactories operational (Fremont, Shanghai, Berlin, Austin); Nevada battery facility expanding. Dojo training compute continued build-out. Cybertruck production ramp remained well below plan.
Key core metrics (4-year trend)
1. Automotive revenue and deliveries
| FY22 | FY23 | FY24 | FY25 | |
|---|---|---|---|---|
| Auto revenue ($B) | 71.5 | 82.4 | 77.1 | 69.5 |
| Deliveries (M) | 1.31 | 1.81 | 1.79 | 1.64 |
| YoY deliveries | +40% | +38% | -1% | -8% |
The trajectory broke in FY24 (first delivery stagnation) and FY25 (first absolute decline). Price cuts that drove the FY23 +38% volume expansion stopped yielding; the FY25 decline reflects both global demand softening and Chinese competitive price pressure on Model 3 / Model Y.
2. Operating margin
| FY22 | FY23 | FY24 | FY25 | |
|---|---|---|---|---|
| Operating margin | 16.8% | 9.2% | 7.2% | 4.6% |
Tesla's operating margin has now contracted for four consecutive years. FY22 peak (16.8%) reflected price/mix benefits during the supply-constrained ramp phase; the subsequent compression tracks price cuts, regulatory credit normalization, and fixed-cost deleverage on flat volumes.
3. Energy storage deployments (GWh)
| FY22 | FY23 | FY24 | FY25 | |
|---|---|---|---|---|
| Deployments (GWh) | 6.5 | 14.7 | 31.4 | 46.7 |
The cleanest growth trajectory in the company. The Megapack product is now Tesla's #2 business by revenue and growing at 50%+ annually. Street models have started to treat Energy as a separate valuation unit because the growth and margin profile diverges materially from Auto.
4. Free cash flow
| FY22 | FY23 | FY24 | FY25 | |
|---|---|---|---|---|
| OCF ($B) | 14.7 | 13.3 | 14.9 | 14.7 |
| Capex ($B) | 7.2 | 9.0 | 11.3 | 8.5 |
| FCF ($B) | 7.6 | 4.4 | 3.6 | 6.2 |
FCF actually improved FY25 on lower capex (the Cybertruck / Mexico gigafactory spend pulled back) and cash efficiency in working capital. FCF margin is 6.6% — higher than operating margin, a quirk of the auto-leasing and working-capital tailwinds.
Market evaluation
Sell-side coverage (as of late April 2026). 14 analysts cover TSLA — a smaller-than-usual coverage list for a mega-cap, but the dispersion is unusually wide.
| Rating | Count |
|---|---|
| Buy | 8 |
| Hold | 4 |
| Sell | 2 |
Price targets. Consensus $419.99, range $24.86 (GLJ Research) to $600 (Wedbush). The $575 spread is the largest among the US mega-cap coverage universes.
Recent analyst activity (Feb 23 through April 24, 2026). One rating change in the window:
- UBS (Joseph Spak) upgraded Sell → Neutral on April 14 with PT $352 — a notable bearish-to-neutral shift after multi-year bearish positioning.
Notable PT moves:
- Wedbush (Dan Ives) reiterated Outperform at $600 multiple times (highest PT)
- Mizuho cut $540 → $480 on April 23 (maintained Outperform)
- TD Cowen cut $519 → $490 on April 15
- GLJ Research (Gordon Johnson) reinstated coverage with Sell at $24.86 on April 21 — the outlier bearish mark that anchors the low end of the range
Buy-side positioning. Tesla is the most bimodal mega-cap — held in size by retail-heavy and thematic funds, under-owned by broad-mandate institutional funds. Short interest consistently 3-5% of float, higher than any mega-cap peer. The 27-to-1 PT ratio between the highest and lowest Street price target ($600 / $24.86) reflects the lack of a neutral consensus on what Tesla is — an auto company, a semi-autonomous software play, an energy infrastructure play, or some combination.
FY25 corporate structure: the Auto → Energy transition, made visible
FY25 is the year Tesla's revenue profile pivoted visibly. For the first time, the Automotive line contracted absolutely while the Energy line grew at 27% — the two businesses that sat under the same ticker diverged sharply. The regulatory credit compression (-28%) is a structural event the Street anticipated but the timing of which surprised on the downside: US federal EV incentive rollbacks under the Trump administration removed a revenue line that had been contributing ~$3B / year of near-100%-margin revenue. The operating margin compression to 4.6% is the clearest print of the transition cost — and also the single largest source of the sell-side dispersion, since Energy's segment-level margins (not separately disclosed) are widely believed to be lower than Auto but are trending in the right direction. Dispersion on the PT range of $24.86 to $600 is ultimately a disagreement about whether Tesla in FY26-FY28 is an auto company with an energy side-business, an energy-and-software company with an auto side-business, or something else. FY25 made the question mandatory; no Street analyst dodged it this year.