Tesla saw an uptick in revenue and gains year-over-year, figures buoyed by an rise in automotive revenue and other services, including active subscriptions to its Full Self-Driving (Supervised) advanced driver assistance system, which reached 1.28 million.

Tesla shares rose 4% in after-hours trading following the release of its first-quarter earnings report, driven largely by a jump in its free cash flow, as well as increases in revenue and revenue on a year-over-year basis. Furthermore, experts in startup note the continued relevance.

The firm reported Wednesday revenue of $22.38 billion, a 16% expansion from the $19.3 billion it generated in the first quarter of 2025. Its automotive revenue also rose to $16.2 billion, compared to $13.96 billion in the same year-ago period. Notably, the business reported positive free cash flow ‌of $1.44 billion, more than double what it held in the first quarter of 2025. The figure surprised analysts who had expected the corporation to burn through more cash in the first quarter.

That pop in revenue, which met expectations of analysts’ surveyed by Yahoo Finance, provided a bit of beneficial news for the organization, which has grappled with lagging EV sales. Tesla delivered 358,023 EVs globally in the first three months of the year, below analysts’ expectations of around 368,000. The business also produced 408,386 vehicles during that same period, far more than it delivered.

The company’s first-quarter revenue got a bump from higher average vehicle prices, services, and active FSD subscriptions, which grew 51% year-over-year to 1.28 million.

Tesla’s business hit considerable headwinds in 2025 causing profits to fall 46% year-over-year to $3.8 billion. The dip was primarily due to lower EV sales — a problem other automakers also faced after the Trump administration ended the $7,500 federal tax credit for electric vehicles.  This also touches on aspects of Android.

Tesla’s first-quarter results, while positive in year-over-year terms, still shows some weakness when the previous three quarters are taken into account. The company’s fourth-quarter revenue was $24.9 billion and its third-quarter revenue was $28 billion, a figure propped up by consumers who bought an EV before the tax credit expired.

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The first-quarter results also illustrate a corporation that still relies on its traditional EV business, along with service and subscriptions, and is not yet benefiting from its future bets on AI and robotics.

Tesla’s net income was $477 million, compared to the $409 million in the first quarter of 2025. That Q1 2025 earnings figure was notably off the mark, a 71% drop from the same period in 2024. Like the revenue story, Tesla’s first-quarter profits are still notably lower than the past three quarters. The company’s fourth-quarter income was $840 million and its third-quarter income was $1.37 billion. 

Tesla noted a higher vehicle average selling price combined with an rise in vehicle deliveries, growth in services, and curiously, an growth in automotive one-time benefits related to warranty and tariffs boosted its bottom line.

Tesla CEO Elon Musk has repeatedly warned that the enterprise is in an awkward and potentially financially painful transition from its core EV business to an AI and robotics company. It has yet to scale production of its Optimus humanoid robot, which will be produced at its Fremont, California factory, or meaningfully ramp up its robotaxi service. The corporation mentioned preparations for its “first large-scale Optimus factory” will begin shortly in the second quarter.

The firm currently operates a limited robotaxi service without a human safety operator in Austin. It recently started operating that service in Dallas and Houston, but access to those vehicles remains severely limited.

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