Key facts
- Tesla has delayed volume production targets for Cybercab, Semi, and Megapack 3.
- The company has removed volume production language for its Optimus robot.
- Capital expenditures more than doubled year-over-year.
- Net income fell 5% to $1.1 billion.
- Free cash flow was negative $1 billion.
- Automotive revenue rose 23% to $20.5 billion.
- Energy storage and solar revenue increased 13% to $3.1 billion.
- Full Self-Driving (Supervised) subscriptions grew 56%.
Tesla is delaying the volume production timelines for its Cybercab, Tesla Semi, and Megapack 3 commercial energy storage solution, according to its second-quarter shareholder letter. The company also removed language regarding volume production for its Optimus robot. Tesla stated it is working to increase battery production, specifically its 4680 cells, to enable scaled manufacturing of the Cybercab and Semi. No specific reason was given for the Megapack delay, nor was there an update on Optimus production holdups.
Earlier this year, Tesla began producing initial Cybercabs at its Austin, Texas factory. However, manufacturing lines for the Semi and Optimus are still under development. As recently as January, Tesla had indicated that the Cybercab, Semi, and Megapack 3 would achieve volume production this year.
These production setbacks coincide with Tesla's significant investment in next-generation products and its strategic shift from an electric vehicle manufacturer to an AI and robotics company. The company reported a 5% year-over-year decrease in net income to $1.1 billion, while capital expenditures more than doubled. Despite a revenue increase, the costs associated with developing and launching new products led to negative free cash flow.
Tesla's total revenue for the second quarter reached $28.2 billion, a 26% increase from $22.5 billion in the same period of 2025. This also represents growth from the previous quarter's $22.38 billion. The majority of this revenue stemmed from vehicle sales and leases, which saw significant improvement. Automotive revenue climbed to $20.5 billion, up from $16.6 billion a year prior. Tesla delivered over 480,000 vehicles in the second quarter, an increase of more than 120,000 from the first quarter, marking its strongest sales performance since the third quarter of the previous year.
Sales in the energy storage and solar segment also performed well, rising 13% to $3.1 billion. Subscriptions for Tesla's Full Self-Driving (Supervised) system continued to grow, reaching 1.48 million, a 56% increase year-over-year. However, the company's profitability was impacted by its investments in new products, with operating expenses ballooning by 47% to $4.3 billion and operating income dropping 57% to $398 million.
Last year, Tesla described the second quarter of 2025 as a pivotal moment for its transition into an AI, robotics, and related services leader. This transition is ongoing, with the company having recently ended production of its Model S and Model X at its Fremont factory to accommodate Optimus robot production. Tesla is also expanding its Robotaxi service to new cities with a limited fleet and continues to promote its Full Self-Driving (Supervised) system.