Tesla reported its fourth-quarter 2024 earnings on Wednesday after U.S. stock markets closed, wrapping up a challenging year for the company’s sales but an exceptional one for its stock price.
It wasn’t a standout quarter for Elon Musk’s company, as weak sales and revenue led to shrinking profit margins and disappointing results. Tesla reported revenue of $25.71 billion, up just 2% from the previous year and below analysts’ expectations of $27.22 billion.
Earnings per share fell short of forecasts, coming in at 73 cents against the expected 76 cents. Operating income declined 23% to $1.6 billion, while net income plummeted 71% to $2.32 billion.
Despite the earnings miss, Tesla stock rose 4% in after-hours trading following the report.
The company continues to face headwinds from increased competition in the electric vehicle market, particularly from automakers in the United States, China and Europe. This has contributed to downward pressure on the prices Tesla can command for its vehicles.
In its shareholder presentation, Tesla said it expects its auto business to return to growth in 2025, driven by the integration of artificial intelligence into its vehicles. Musk claimed that within six months, driverless cars would be operating in Austin, Texas, where Tesla is headquartered.
Musk presented the Tesla Cybercab, which he called a self-driving taxi, at a demonstration in October. During Wednesday’s earnings call, he said the model would go into production in 2026, though Tesla has a long history of delayed releases. Musk also announced that Tesla’s robotaxi business would launch in June 2025, though details on its implementation remain unclear.
Additionally, the company noted that its plans for new vehicles and their production would result in "less cost reduction" than previously expected.
Tesla stock has surged since the election, fueled by investor optimism over the close relationship between CEO Elon Musk and President Donald Trump. Over the past year, Tesla shares have more than doubled, climbing 75% in the last six months alone.
Musk’s ties to Trump have strengthened investor confidence in his ability to secure a favorable regulatory and business environment for Tesla, despite congressional Republicans’ efforts to eliminate tax credits for electric vehicles.
Meanwhile, the president has threatened tariffs on a broad range of goods, including cars from China, a move that could significantly benefit Tesla.