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Tesla shares are down around 9 percent in early trading on Thursday, hammered by the EV giant's steepest revenue decline in at least a decade, and compounded by the likelihood of a few "rough" quarters ahead.
For the benefit of those who might not be aware, Tesla reported $22.496 billion in revenue for the second quarter of 2025, beating its IR-compiled consensus estimate of $21.934 billion. However, on a year-over-year basis, Tesla's revenue declined by 11.78 percent, constituting its steepest fall in around a decade.
Elsewhere, the EV giant's free cash flow shrank to just $146 million, and cash balance declined for the first time in a number of years, as tariff costs increased by around $300 million.
As far as Tesla's bottom-line metric is concerned, the EV giant disclosed $0.40 in non-GAAP (adjusted) EPS, beating consensus expectations of $0.39.
However, without a ~$400 million contribution from Tesla's 'Other Income' conglomeration, its EPS would have printed at around $0.33 per share, markedly short of consensus estimates.
Tesla discloses in its From 10-Q that its 'Other Income' section of the income statement groups together gains and losses from its FX holdings, as well as revaluation gains and losses from its Bitcoin holdings.
Accordingly, we calculate that around $282 million - constituting well over half of its $400 million 'Other Income' pie - came from the revaluation gains on Bitcoin.
We estimate that Tesla's Bitcoin stash of 11,509 BTC was worth $950.055 million on the 31st of March, based on the day's closing price of $82,548.91 per BTC.
The same stash was worth $1.233 billion on the 30th of June, based on the day's closing price of $107,135.34 per BTC.
This equates to a revaluation gain of $282.965 million on Tesla's Bitcoin stash for the three-month period that ended on the 30th of June.
Elsewhere, Tesla confirmed that its much-anticipated, more affordable model is simply a stripped down version of the Model Y, leading to fears of upstream cannibalization without the benefits of a new form factor's TAM.
Of course, Tesla's one bright spot remains its AI-related efforts, as embodied by robotaxis and the Optimus humanoid robots. Elon Musk said during Tesla's earnings call:
"I’m not saying we will, but we could -- you know, Q4, Q1, maybe Q2, but once you get to autonomy at scale in the second half of next year, certainly by the end of next year, I think I’d be surprised if Tesla’s economics are not very compelling."
