Tesla’s ‘Dismal’ Quarter Was Rescued by Power Storage Facet Hustle

One of many few brilliant spots of Tesla’s dire earnings is now within the crosshairs of Trump’s tariffs.

The EV maker’s vitality technology and storage enterprise, which incorporates Tesla’s Megapack and Powerwall battery programs, introduced in $2.73 billion within the first three months of 2025, up 67% from final yr.

These sturdy numbers put a gloss on what was in any other case a really underwhelming set of outcomes.

Tesla’s internet revenue plummeted to $409 million from almost $1.4 billion in the identical interval final yr, nicely under Wall Road’s expectations.

Revenues from its automotive enterprise fell 20% as the corporate’s gross sales collapsed throughout the globe amid a wave of Elon Musk-fuelled protests and vandalism.

“Seems to be like vitality storage saved some fairly dismal numbers from Tesla,” wrote Tesla investor Ross Gerber in a submit on X.

Nevertheless, Tesla’s profitable aspect hustle faces a severe speedbump within the type of the escalating commerce battle between the US and China.

Talking on an analyst name after the earnings, Tesla’s CFO, Vaibhav Taneja, mentioned that whereas the Trump administration’s tariffs will hit the corporate on auto elements, the impact on Tesla’s vitality storage enterprise from the tariffs on China will likely be extra extreme.

“The influence of tariffs on the vitality enterprise will likely be outsized since we supply LFP battery cells from China,” mentioned Taneja.

Though Tesla makes Megapacks and Powerwalls at its factories in California and Nevada, the corporate imports the battery cell parts for these programs from China, which dominates the worldwide battery manufacturing trade.

Taneja added that Tesla was trying to arrange the manufacturing of lithium-iron phosphate batteries within the US to get across the tariffs, however was going through a scarcity of producing tools.

“We have additionally been engaged on securing further provide chain from non-China-based suppliers, however it can take time,” mentioned Taneja.

Tesla faces fewer headwinds from the tariffs than different automakers, because it has sought to localize manufacturing of its vehicles and vitality programs within the markets it sells them in.

The corporate just lately started Megapack manufacturing at a brand new manufacturing facility in Shanghai close to the gigafactory that produces its Chinese language EVs.

Regardless of this, Elon Musk has warned the auto tariffs launched by Trump may have a “vital” influence on Tesla.

The billionaire, who mentioned on Tuesday he would step again from his cost-cutting position within the Trump administration, advised traders that he would “proceed to advocate” for decrease tariffs — however mentioned that Trump finally referred to as the photographs.

“I made my opinion clear to the president, and different folks made their opinion clear to the president,” mentioned Musk.

“I am hopeful that the president will observe whether or not my predictions are extra correct than the predictions of others and maybe weigh my recommendation otherwise sooner or later. We will see,” he added.