Tesla reports steep drop in profits despite US rush to buy electric vehicles

Wow, it supports m1 and m2 Macs! I kind of love the idea of getting back to a proper Unix environment on a reasonably current Mac.

>The earnings report comes at a sensitive time for Tesla and Musk, as the CEO is seeking investor approval for that unprecedented $1tn pay package in a vote next month.

WTAF. I'm not sure who could think he deserves this much pay (other than himself), after tanking the brand.

The articles are stupid. It's up to $1T IF he raises the stock price ~7x.

It's basically the board saying "uh, sure, if you earn us 8.5 trillion dollars, we'll give you a trillion of it".

It's an absurdly high bar, and the board had no real incentive to not throw it out there. Honestly every board should do this. Why not.

It's almost entirely milestone/incentive based. Should Tesla continue on this trajectory, he won't see a dime. Tesla has to hit an $8 trillion market cap, deliver 20 million vehicles, and 1 million robotaxis, and $400 billion in adjusted earnings. Were Tesla to hit those numbers in the specified time frame, Musk's comp would be worth every penny to investors.

From an outside perspective, it feels wrong that the goal isn't higher earnings but a higher stock price. They don't care about actually creating value, just keep inflating the bubble and you're golden.

There are multiple milestones. Earnings is one of them. So it's actually even harder than just an earnings target.

Very hard to take this article seriously when they claim the Model Y was just released this month when it actually came out in 2020. "Tesla also debuted a long-promised, cheaper sedan called the Model Y earlier this month in a bid to increase slumping sales. The new line of sedans received criticism from some analysts over its starting prices of $39,990 and $36,990 – significantly higher than Chinese low-cost competitors." Also the claimed "Rush to buy electric vehicles" put revenue only 2% above expectations?

I think you might have posted this to the wrong comments thread.

The Nazi salute was the end of it for a lot of folks who had given him grace for awhile

What a monumental fall

> Also the claimed "Rush to buy electric vehicles" put revenue only 2% above expectations?

The rush to buy electric vehicles was baked into the expectations, so beating by 2% is still noteworthy.

Presumably they mean the Model Y Standard. The existing model became the Model Y Premium.

If a trillion dollars is on the line, could the stock be manipulated to be higher than that for less than a trillion?

Yeah, I'd have no trouble voting for that $1T package. There are way too many conditions. There are lots of ways Musk doesn't get paid. The original $56B package was only revenue and stock price based. If it was like this one, it would also have been based on car deliveries, and solar installs, and stationary battery sales. He would have totally missed on the solar installs, despite being massively successful on everything else.

Perhaps we just missed a tweet where Elon announced 4.3 BSD for ARM64.

They just refreshed the Model Y with a new “standard” model which they are also just calling Model Y with the old base model now being called Premium.

So what they said is correct but a little misleading, perhaps as a dig on Tesla’s naming conventions.

Blame Tesla for the branding. Wikipedia on the Model Y L[0]

  In June 2025, Tesla introduced the three-row, six-seater version of the Model Y, marketed as the Model Y L.[84] Debuting in China and produced at Gigafactory Shanghai, the variant introduces a six-seat configuration with a lengthened cabin and upgraded interior features. It is equipped with 19-inch aero wheels in a new design and offers a new exterior colour option called Cosmic Silver. Deliveries in China commenced on September 2, 2025.[85] 

[0] https://en.wikipedia.org/wiki/Tesla_Model_Y

Other private Musk companies (SpaceX and xAI) just bought fleets of Cybertrucks. One may wonder what exactly they would do with so many vehicles other than boost Tesla's share price.

8.5 trillion in 10 years, is 20% growth per year. For comparison S&P 500 grew 25% last year.

So much of their planned earnings was coupled with cozying up to the current political administration:

> The loss of EV credits as a result of Donald Trump’s One Big Beautiful Bill Act was a factor in the public breakup between Musk and the president and has continued to influence the company’s sales forecasts.

> Musk has also insulted Sean Duffy, the US transportation secretary, this week in a series of posts that included calling him “Sean Dummy” and reposting calls for him to be removed from his post. Duffy, who is also acting head of Nasa, stated on Monday that he would reopen the bidding for contracts related to the space agency’s Artemis moon mission because Musk’s SpaceX rocket company had fallen behind on its timelines for the project.

Is anyone buying Teslas in blue states, since Twitter/X, Nazi saluting, DOGE, etc.?

Also, the basic game theory is obvious. If it’s voted down, Musk might leave, in which case the stock price plummets.

All states are purple. Of course there's folks in "blue" states that are buying Teslas. And there's folks in "red" states that are boycotting Tesla.

The board can modify those milestones and conditions, no?

Perhaps they will buy a Ford or Volkswagen instead.

Except for Wyoming.

That's because the map just shows discrete pixels of blue/red, one for each person.

Just guessing, but wouldn't surprise me if most luxury brands are struggling at the moment. I don't think this is the right time to buy a brand new, luxury car for most people. Considering the inflation, unemployment and uncertainty.

Two companies that aren’t currently being run by people throwing nazi salutes; great choices.

Is Tesla a luxury brand?

They don’t sell a car over 62000€ in Europe.

Only those who don’t care about what’s happening and keep their heads down in order to maintain their perfect and convenient lives.

Tesla is not a luxury brand, but they ask for premium prices, compared to the value (worst in ADAC statistics on repairs)

“ In 1974, a new car cost an average of 5320 euros. The average income was 13,928 euros per year, so a buyer had to work for an average of 4.6 months for a new car. 20 years later, it was already 7.4 months per new car. Until 2019, this number remained stable, but then it skyrocketed. Today, a buyer has to spend all his income from 9.6 months of employment to buy a new car. For more expensive e-cars, it is even 11.4 months. The reason is stagnant incomes, but also high profit margins of the manufacturers.” https://www.tagesschau.de/wirtschaft/verbraucher/kosten-auto...

From my personal perspective, as an employed software engineer, all cars over 50k are luxury.

I think insurance considers Teslas to be luxury vehicles?

Just try and VW ID7 or Audi A6 etron.

Earn cool 19k on each of the 21 million cars sold? That is some hefty margins to get to those earnings... Especially when you have Chinese models to compete with.

But they did introduce a cheaper sedan this month. It happens to be called the Model Y as well. This is unambiguously true. I think your reading comprehension needs work. It's not saying this is the only Model Y or that there is no other Model Y.

and they dont sell one under $40k in the US, that buys you two toyota corollas

The value derived and average usage of a car has increased too... Also the financing around cars have made it smoother to buy one. Also Electric can demand a premium because they save on gas costs.

Extremely relative. I escaped part of the US where any car that started reliably was luxury. New, or brand selection, was absolutely out of the question.

62k Euros gets a lifetime of used vehicles. I'll say the quiet thing: buying a new car and taking the depreciation is a form of luxury. More about status than getting to the destination.

Dan has a point. I could pay for half of a house right now, committing seems silly until things cool down. Two articles away from being relocated again, despite working remotely.

Which will outlive Tesla cars at least by decade.

I don't believe we will have such growth at all in the next 10 years unless we get hyperinflation

growing 25% when a company is say 50-100b is a lot different than going towards 10 trillion

and valuations are already so stretched across the board

Too true. Beautiful country though and the people were friendly.

They need them for the Mars colony, duh. You can't drive a gas car on the moon.

They also haven’t released a vehicle that is particularly relevant in like 6 years.

Yes, the Cybertruck that nobody really wants, and a Model Y with an extended wheelbase. Yay.

Why do things have to change constantly? Like the Model Y was insanely different to any other car I’d ever driven not long ago, and Tesla was first to market on actually good electric cars. Why do they have to operate using the same strategy as legacy auto makers? Like a design refresh every 3 years to drive excitement feels manipulative to me, not like something that is absolutely necessary. Are you saying that competitor electric cars are outcompeting them by a wide margin now? I’m not really aware of which ones if so, at least in the American market. AFAIK the electric car program for all of the legacy auto makers is still a money pit for them, is it not?