Balanced Review: Tesla Q1 2025 earnings and other updates

Following are highlights of Tesla’s Q1 2025 update Letter:

•Total Revenues: $19.3 billion
•Total automotive revenues: $13.967 billion
•Total GAAP gross margin: 16.3%
•Gross Profit: $3.15 billion
•EPS non-GAAP: $0.27 per share
•Free cash flow: $664 million

•Tesla’s total revenue decreased 9% YoY to $19.3 billion YoY. This was due to a decline in vehicle deliveries, in part due to the new Model Y changeover and reduced vehicle average selling price (ASP), among other factors.
•Tesla is still profitable, though operating income decreased 66% YoY to $0.4 billion. This also resulted in a 2.1% operating margin. Tesla’s profitability in the first quarter was affected by reduced vehicle ASP, a decline in vehicle deliveries, and an increase in operating expenses driven by AI and other R&D projects partially offset by a decrease in SG&A, among other factors.
•Tesla’s quarter-end cash, cash equivalents and investments stand at a healthy $37 billion. The sequential increase of $0.4 billion was primarily the result of positive free cash flow of $0.7 billion.

•Tesla Energy continued its momentum in Q1 2025, with the division deploying 10.4 GWh of energy storage products during the quarter.

There are many updates given by Elon Musk. I'll outline 5 important announcements:

1. Tesla has announced that its more affordable models remain on track to be introduced in the first half of 2025.

2. Tesla remained on track for pilot launch of Robotaxi in Austin by June and builds of Optimus on their Fremont pilot production line in 2025, with wider deployment of bots doing useful work across our factories.

3. Tesla had a record quarter for Powerwall in Q1. "We achieved a fourth sequential record for Powerwall deployments, crossing 1 GWh for the first time, and continue to be supply constrained. Gross margin for the Energy Business improved sequentially."

4. Tesla drivers have now cumulatively driven over 3.6 billion miles on FSD (Supervised) as of the end of March, up from 2.9 billion at the end of December. That's an average of 8.88 million miles per day.

5. Elon Musk says his time allocation to DOGE will drop significantly starting next month and that he will devote far more time to Tesla.
"The large slug of work necessary to get the DOGE team in place is mostly done; I'll continue to spend 1-2 days per week as long as the President wants me to."

My Take:

1. Despite the earnings missed estimate, the share price is almost +3% in post market and later +5.37% when intraday market closed. What the bears said about share price plummet after earnings didn't happen.

2. The market sentiment remains bullish partly due to the future businesses that  Tesla outlined and updated. As mentioned in my previous posts, long term investors are not concerned about the earnings which looked at the company as a car maker. They are more interested  in the revenue that may bring in when Robotaxi and affordable EV models start to deliver. Legacy media previously reported that Tesla has scrapped the affordable EV model which is not true (fake news).

3. I can see someone continue to ignore what Tesla has announced during the earnings. Instead they focused on presenting Tesla's loss market share due to what Elon Musk did under Trump's administration and the "brand damage" caused by Elon Musk.

4. It is important to have a balanced view about the earnings. It is dangerous to just read the negatively biased information and views released by the extreme leftist democrats whose sole purpose is to cause fear.

5. Below are 2 YT videos that summarized important earnings highlights: