Tesla, Inc.

Tesla reported record Q2 deliveries. Vaibhav Taneja said deliveries grew sequentially across the Americas, APAC and EMEA by 60%, 27% and 12%, respectively, and that Model Y set records in several key markets. Automotive gross margin excluding regulatory credits declined to 16.3% from 19.2% sequentially; management said Q1 had a $230 million benefit from warranty true-downs and tariff relief that did not repeat, and that underlying auto gross margin would have been approximately flat. Energy storage deployments were 13.5 GWh, up 53% sequentially, while energy gross margin fell to 20.4% from 39.5%, reflecting a roughly $240 million warranty true-up, more than $200 million of non-repeat tariff benefits, and lower ASPs in industrial storage. Service and other margin rose to an all-time high of 14.1% from 9.2%. Free cash flow was negative in the quarter, capex more than doubled sequentially, and Tesla reiterated full-year capex guidance of more than $25 billion; capex is expected to rise further in 2H 2026 and over the next two to three years. Management also said it has debt facilities that would allow borrowing up to $30 billion to support investments.

Elon Musk framed the quarter as a demand and execution win, highlighting record deliveries, growing FSD adoption, and strong momentum in energy, autonomy, and robotics. His tone was highly confident about Tesla’s long-term roadmap, repeatedly emphasizing that robotaxi, Optimus, Terafab, AI chips, and solar manufacturing are part of what he called a major build-out of advanced infrastructure. He also stressed caution on robotaxi safety, saying Tesla wants to scale quickly without causing harm.

Vaibhav Taneja focused on the financial tradeoffs of a heavy investment cycle. He said automotive margins were pressured by the absence of Q1’s $230 million warranty/tariff benefit and by higher interest-rate subvention costs, while energy margins were hit by a roughly $240 million warranty true-up and more than $200 million of tariff benefits that did not repeat. He said capex was more than doubled sequentially, free cash flow was negative, capex should exceed $25 billion this year, and spend should keep growing for the next two to three years as Tesla expands robotaxi, Optimus, semiconductor, solar, and AI compute infrastructure. He also noted Tesla is opportunistically securing debt capacity of up to $30 billion.

Analysts pressed Tesla on how it will scale Optimus given the lack of a mature supplier base, and management said suppliers including Samsung, TSMC, Panasonic, and Micron are investing heavily alongside Tesla, while Tesla will in-source where needed. Questions on robotaxi regulation and rollout centered on state sensor rules, federal approvals, and why Tesla is expanding city by city; management said performance will drive adoption, and that city-by-city scaling helps prove the stack, satisfy local requirements, and build miles safely. There were also questions on whether Tesla would partner with third-party ride providers and whether Cybercab/ Semi autonomy would be prioritized; Elon said robotaxi will remain vertically integrated, Semi autonomy is important but lower priority than Model 3/Y and Cybercab, and full Semi self-driving is targeted for around the end of this year or early next year.