**A Reality Check for Tesla’s Ambitions**
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In this edition, we’re taking a closer look at Tesla’s latest earnings report and what it means for the company’s future. As you may know, Tesla CEO Elon Musk has been trying to rebrand the company as something more than just an electric vehicle manufacturer. He’s pitched Tesla as a sustainable energy company, and more recently, as an AI and robotics company. But the numbers tell a different story.
According to Tesla’s latest earnings report, the company generated $94.8 billion in revenue in 2025, with the majority coming from the sale of electric vehicles and related regulatory credits. The remaining $25 billion is split between its energy generation (solar) and storage business, and “services and other,” which includes revenue from Superchargers, parts sales, and Full Self-Driving subscriptions.
As you can see, the company’s reliance on EV sales has led to a decline in profits. In 2025, Tesla’s profits were 46% lower year-over-year. To compensate, the company is planning to increase its capital expenditure to $20 billion in 2026, which will put it in negative cash flow territory.
So, what does this mean for Tesla’s ambitions? Well, the company is planning to end production of the Model S and Model X, which represents about 2% of its sales volume. Instead, it will focus on producing its Optimus humanoid robots and scaling its robotaxi operations to more cities in 2026.
But here’s the thing: while Tesla is making strides in these areas, it’s clear that the company’s financials are still heavily reliant on EV sales. And with the decline in profits, it’s unclear whether Tesla can sustain its ambitions for long-term growth.
**Other News and Notes**
* Waymo is reportedly in talks to raise up to $15 billion in funding, with Alphabet leading the round. We’re hearing that one of the other investors may be an OEM.
* Waabi, an autonomous vehicle startup, has raised $750 million in a Series C round, with Uber also investing $250 million in milestone capital.
* Gatik AI, a startup developing autonomous trucks, has signed a deal with a major consumer-goods company to deliver $600 million in revenue over five years.
* Luminar’s lidar business has been sold to MicroVision for $33 million.
* Rad Power Bikes has reached a deal to sell itself to Life Electric Vehicles Holdings for around $13.2 million.
* Redwood Materials, a company that recycles lithium-ion batteries, has raised $425 million in a Series E round.
**Notable Reads and Other Tidbits**
* Obi, a company that aggregates real-time pricing and pickup times across multiple ride-hailing services, has shared new data on ride-hailing and robotaxis in the San Francisco Bay Area.
* Uber has launched a new division called Uber AV Labs, which will share sensor-equipped car data with partners like Lucid, Waymo, and Waabi.
* Waymo is now allowed to operate a robotaxi service to and from the San Francisco International Airport.
* The San Francisco Police Department is investigating an incident involving a Zoox autonomous vehicle that crashed into a parked car.
**One More Thing…**
What do you think the name or ticker of Musk’s combined supercompany will be? Let us know in the comments!
