Tesla to discontinue vehicle variants, infuses $2B in Musk’s AI venture
Elon Musk’s electric vehicle business reported a 11% decline in quarterly revenue year-on-year as competition from EV-makers, including BYD, strengthened in key markets.
Tesla on Friday reported a 11% decline in total automotive revenue for the three months ended December 31 as it continues to fend off growing competition from other automakers, including China’s BYD, which has surpassed Tesla to become the largest EV maker globally.
While Tesla's automotive revenue declined, it saw an uptick in revenue from energy generation and storage as well as from services and other revenue, partially offsetting the hit from automotive revenue. Tesla reported a 3% decline in total revenue for the quarter to $24.90 billion.
Tesla also reported a decline in adjusted net income attributable to common stockholders to $1.76 billion compared to $2.12 billion in Q4 2024.
During the conference call, Musk also added that the company will discontinue its Model S sedans and Model X SUVs—early models the firm had introduced—and that the factory space will be used to build robots.
Tesla also reported its first ever decline in annual revenue to $94.8 billion, which fell by 3% compared to the year ended December 31, 2024.
Additionally, the firm also said that on January 16, Tesla entered into an agreement to invest about $2 billion to acquire shares of xAI as part of its recently disclosed funding round. The company had raised $20 billion earlier this month, surpassing an original $15 billion target in a deal that drew sovereign, institutional and strategic backers.
Tesla also noted that its Cybercab, Tesla Semi, and Megapack 3 are on schedule for volume production in 2026.