Tesla (TSLA) reported a decline in annual vehicle deliveries for the second consecutive year in 2025, with fourth-quarter sales dropping 16% to 418,227 vehicles compared to the same period in 2024. Total deliveries for the year fell to approximately 1.64 million units, down from nearly 1.8 million in 2024, marking an 8% year-over-year decline compared to 1% in 2024. This downturn allowed BYD to surpass Tesla, logging record sales of 2.26 million battery electric vehicles (BEVs) in 2025, a 28% increase year-over-year.
Despite challenges in its core electric vehicle business due to competition and the expiration of tax credits, CEO Elon Musk is focusing on future growth through autonomous vehicles, AI, and robotics. Tesla’s energy generation and storage segment did see growth, with a record deployment of 14.2 GWh in Q4 2025 and an annual increase of 48.7% to 46.7 GWh.
Overall, analysts indicate that while Tesla faces near-term challenges, long-term prospects in robotaxis and energy storage could alter its earnings mix. The Zacks Consensus Estimate projects a 3% decline in revenues for 2025, but anticipates an 11.6% revenue increase by 2026.
