A bigger hit than expected

The numbers are out and Tesla’s sales slump took a huge chunk out of its profit. The company reported a $409 million profit for the first quarter of 2025, down 71% year-over-year.

It also sold $595 million in regulatory credits, meaning without those, it would have slipped back into the red for the first time in years. 

The company generated $19.3 billion in revenue during the quarter, which was lower than the $21.4 billion estimate coming from analysts surveyed by Yahoo Finance. It’s a double-whammy: Tesla is selling fewer vehicles and it’s selling them for less to stay competitive, which is eating into its profits and industry-leading gross margin