Tesla Inc. reported a 9% year-on-year revenue decline to USD19.3 billion for the first quarter of 2025, amid global market uncertainty influenced by political sentiment and changes in international trade policies.
According to Tesla, rapidly shifting trade policies including increased tariffs significantly impacted the company’s cost structure and supply chain, in turn affecting product demand in several key markets.
“While the current tariff landscape will have a relatively larger impact on our Energy business compared to automotive, we are taking actions to stabilize the business in the medium to long-term and focus on maintaining its health,” the statement said.
Automotive revenue dropped 20% to USD13.97 billion, driven by a decline in deliveries and average selling prices of vehicles. In contrast, the energy segment posted strong growth of 67% to USD2.73 billion.
Despite a 66% plunge in operating profit to USD399 million, Tesla maintained an operating cash flow of USD2.2 billion and boosted its cash reserves to USD37 billion.
Tesla also reaffirmed its commitment to investing in AI technology and affordable vehicle models, while adjusting its business strategy to navigate geopolitical risks and uncertain trade policies.
Shahriena Shukri is a journalist covering business and economic news in Malaysia, providing insights on market trends, corporate developments, and financial policies. More about Shahriena Shukri.
