TSLA · 10-Q · 2026Q1 · Full report
Gross Margin Drivers
Tesla, Inc. · 2026-04-23 · Importance 78 · Surprise 74 · No source text
Total gross profit for Q1 2026 was $4,720 million versus $3,153 million in Q1 2025, and total gross margin improved to 21.1% from 16.3% year over year. Automotive gross profit was $3,422 million and automotive gross margin increased from 16.2% to 21.1%, driven by higher automotive sales revenue, changes in sales mix and a decrease in regulatory credits revenue. Automotive & Services gross margin rose to 18.9% from 14.3% due to improvements in automotive sales gross margin and increased services profitability. Energy storage gross margins improved materially (from 28.8% to 39.5%) as lower average cost per unit, one-time tariff benefits and reduced material costs offset lower deployments.
Key facts
- Gross profit for total automotive for the three months ended March 31, 2026 was $3,422 million and gross margin for total automotive was 21.1% versus 16.2% in the prior year period. source
- Cost of automotive sales revenue increased $1,155 million, or 10%, in the three months ended March 31, 2026 compared to the prior year period. source
- Total gross profit for the three months ended March 31, 2026 was $4,720 million and total gross margin was 21.1%. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| operating_income | negative | realized | -5.2% | Cost of automotive sales revenue increased $1,155 million, or 10%, in the three months ended March 31, 2026 compared to the prior year… |
| margin | positive | realized | +4.9% | Gross profit for total automotive for the three months ended March 31, 2026 was $3,422 million and gross margin for total automotive was… |