TSLA earnings analysis
What we found in TSLA's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Tesla delivered strong top-line growth in Q2, with revenue up 26% year over year to $28.236 billion, led by a 27% increase in automotive sales and 50% services growth. However, gross margin fell to 16.8% and operating margin contracted to 1.4% as R&D increased 49% and SG&A increased 45%, while EPS remained flat at $0.33. Liquidity is robust at $43.52 billion, but the company is entering a much more capital-intensive phase, with $8.280 billion of first-half capex and expected 2026 capex above $25 billion.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue accelerated 26% year over year
- Q2 revenue rose $5.740 billion, or 26%, year over year to $28.236 billion; it also increased from $22.39 billion in Q1 2026. Automotive sales rose $4.219 billion (27%), driven by approximately 25% higher cash deliveries.
- Services growth supplemented automotive sales
- Automotive & Services and Other segment revenue increased $5.390 billion, or 27%, to $25.097 billion. Services and other revenue grew $1.535 billion, or 50%, led by used-vehicle volume/pricing, non-warranty and collision work, and paid Supercharging sessions.
- Energy-storage revenue and deployments increased
- Energy Generation and Storage revenue rose $350 million, or 13%, to $3.139 billion, primarily from higher Megapack deployments. Tesla deployed 22.3 GWh of energy storage products during the first half of 2026.
- Operating cash flow and liquidity strengthened
- Operating cash flow for the first six months rose $3.938 billion to $8.634 billion, aided by a $3.005 billion favorable change in net operating assets and liabilities. Cash, cash equivalents and short-term investments remained substantial at $43.52 billion.
- EPS held flat year over year, rose sequentially
- Diluted EPS of $0.33 was unchanged from $0.33 in Q2 2025 and increased from $0.13 in Q1 2026. Net income attributable to common stockholders was $1.11 billion, down only $58 million year over year despite materially higher AI-related spending.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Margin erosion despite higher revenue
- Profitability compressed: total gross margin declined 40 basis points year over year to 16.8% and 430 basis points sequentially from 21.1% in Q1 2026. Operating margin was 1.4%, versus 4.1% a year earlier and 4.2% in Q1.
- Energy margin declined sharply
- Energy Generation and Storage gross margin fell 990 basis points year over year to 20.4%, as cost of revenue rose $556 million (29%) versus revenue growth of $350 million (13%). Management cited sales mix and unfavorable warranty adjustments.
- Capex plan exceeds $25 billion
- Investment intensity is increasing materially: first-half capex rose $4.395 billion to $8.280 billion, nearly matching $8.634 billion of operating cash flow. Tesla expects full-year 2026 capex to exceed $25 billion and says heightened capital spending may require funding beyond operating cash flow.
- Regulatory-credit revenue fell 67%
- Regulatory-credit revenue declined $293 million, or 67%, to $146 million in Q2. Tesla states recent governmental and regulatory actions have restricted certain credit programs tied to its products.
- No Item 1A update; FX exposure remains material
- Item 1A contains no revised risk factors, instead incorporating those from the 2025 Form 10-K. Separately, management quantifies that a 10% adverse foreign-exchange move could produce a $1.64 billion pre-tax gain or loss, and it generally does not hedge this exposure.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.33
- Gross margin
- 16.8%
- Operating margin
- 1.4%
- Segment
- Automotive & Services and Other revenue: $25.097 billion, up $5.390 billion (27%) year over year.
- Segment
- Energy Generation and Storage revenue: $3.139 billion, up $350 million (13%) year over year.
What they said about what is next.
Tesla gave no quantitative revenue or EPS outlook in the 10-Q. It expects 2026 capital expenditures to exceed $25 billion, driven by AI compute/data centers, manufacturing and R&D lines, company-operated AI-enabled assets, and retail/service/charging expansion.
The filing reads about the same as the one before it.
What came before.
- 10-K · April 30, 2026
- Tesla's 2025 10-K reveals a robust strategy focusing on AI and sustainability, with revenue reaching $115.27 billion, reflecting a 22% growth year-over-year. Key segments include robust sales from electric vehicles and…
- 10-Q · April 23, 2026
- Tesla reported Q1 2026 revenue of $22,387 million, up $3,052 million (16%) year‑over‑year, with total gross margin improving to 21.1% from 16.3% a year earlier. Operating income was $941 million (≈4.2% operating margin)…
- 10-K · January 29, 2026
- Tesla emphasizes a strategic pivot to commercialize AI across vehicles, Robotaxi and humanoid Bots while continuing to scale vehicle and energy businesses. FY2025 revenue was roughly $94.84B (down from ~$97.69B in…
- 10-Q · July 24, 2025
- Tesla reported Q2 2025 revenue of $22,496 million, down from $25,500 million in Q2 2024; gross margin compressed to ~17.2% and operating margin to ~4.1%, with diluted EPS of $0.33. Operating cash generation strengthened…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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