Tesla’s Q1 earnings are rising, driven by EV sales and FSD registrations

Tesla saw a year-over-year increase in revenue and profit, figures that were boosted by increased sales of cars and other services, including subscriptions to its self-driving program Full Self-Driving advanced, which reached 1.28 million.

Tesla shares rose 4% in trading hours after the release first quarter earnings reportdriven by its free cash flow, with increased revenue and profit year-on-year.

The company reported on Wednesday revenue of $22.38 billion, an increase of 16% from the $19.3 billion it made in the first quarter of 2025. Its vehicle revenue also rose to $16.2 billion, compared to $13.96 billion in the same year. The company reported free cash flow of $1.44 billion.

The increase, which matched analysts polled by Yahoo Finance, was good news for the company, which has struggled with declining EV sales. Tesla delivered 358,023 EVs worldwide in the first three months of the year, below analysts’ expectations of about 368,000. The company also produced 408,386 vehicles during the same period, more than it delivered.

Tesla’s business took a big hit in 2025 which caused it profit fall 46% per year to $ 3.8 billion. The drop was largely due to slowing EV sales — a problem some automakers have also faced after the Trump administration ended the $7,500 tax credit for electric vehicles.

Tesla’s first quarter results, while good on a year-over-year basis, still show some weakness when the past three quarters are considered. The company’s fourth-quarter earnings were $24.9 billion and third-quarter earnings were $28 billion, boosted by consumers who purchased EVs before the tax credit expired.

The first quarter results also show the company is still relying on its traditional EV business, as well as services and subscriptions, and is not yet reaping the benefits of its future bets on AI and robotics.

Tesla’s net income was $477 million, compared to $409 million in the first quarter of 2025. That Q1 2025 profit was notable. from the displaydown 71% from the same period in 2024. As a financial matter, Tesla’s first quarter profit is still significantly lower than the previous three quarters. The company’s fourth quarter profit was $840 million and third quarter revenue was $1.37 billion.

Tesla CEO Elon Musk has repeatedly warned that the company is in financial trouble and that the transition from its core EV business to An AI and robotics company. It is expected to develop its Optimus humanoid robot, which will be manufactured at its Fremont, California factory or further develop its robotaxi service. The company currently operates a limited number of robotaxi services without a public safety operator in Austin. It recently began operating in Dallas and Houston, but access to the vehicles is still limited.