Tesla’s profits are here, and so are its investments in xAI. In a big surprise, CEO Elon Musk announced that Tesla would completely discontinue production of the Model S and Model X and give them “honorable termination.”
Tesla also announced a $2 billion investment in Musk’s AI company, xAI, and entered into a related “framework agreement” to explore additional partnerships. Tesla also plans to unveil its third generation Optimus robot later this quarter.
The company’s revenue for the quarter was $24.9 billion, which was below expectations, but adjusted earnings per share beat estimates by $0.50.
Shares rose 3% in after-hours trading. It closed almost flat on Wednesday.
“2025 is a key year for Tesla as we further expand our mission and continue our transition from a hardware-centric business to a physical AI company,” the company said in the report.
Wall Street was nervous in the lead-up to the earnings release as sales were declining and the company’s AI roadmap had not yet taken shape. All eyes are on Elon Musk’s plan to continue rolling out robotaxis in the United States and Tesla’s Optimus robot business, which investors are starting to value at a premium compared to Tesla’s car business.
The conference call between Tesla and analysts began at 5:30 p.m. ET. The latest information is below.
