TSLA 2026 Q2

Q2 deliveries hit a record and extended the demand resurgence first seen at the end of Q1, with sequential delivery growth across all regions (Americas, APAC, EMEA).

“Q2 continued the trend that we saw at the end of Q1, a resurgence in demand for our vehicles across the globe.”— Vaibhav Taneja, CFO

Model Y is now described as the best-selling vehicle of any kind globally and is setting records across markets, indicating accelerating popularity versus prior periods.

“the best-selling car of any kind in the world and is setting records across the board.”— Elon Musk, CEO

Tesla shifted FSD monetization strategy by removing the outright purchase option in most markets, expecting future FSD revenue growth to come predominantly from subscriptions rather than upfront sales.

“We expect that the bulk of the growth in FSD monetization will come from subscriptions as we removed the purchase option in most markets.”— Vaibhav Taneja, CFO

Sequential delivery growth accelerated sharply across regions: Americas up 60%, APAC up 27%, and EMEA up 12%, reflecting a broad-based demand rebound.

Per Vaibhav Taneja, CFO

Order backlog reached its highest level since 2023, signaling strengthening forward demand versus prior quarters.

“We exited Q2 with our largest order backlog since 2023.”— Vaibhav Taneja, CFO

Robotaxi unsupervised miles driven have grown at a compounding rate exceeding 10% per week for several months, and management expects this exponential growth pace to continue.

“we have grown at such a high compounding rate on a week-over-week basis over the last several months.”— Ashok Elluswamy, VP of AI

Model Y set new sales records in several international markets including the Netherlands, Australia, and New Zealand, an escalation versus prior performance in those regions.

Per Vaibhav Taneja, CFO

Robotaxi service expanded to seven U.S. markets and management expects the fleet ramp and geographic expansion to accelerate through the rest of the year.

“We expect the ramp of the fleet to accelerate throughout the year, along with the expansion into new U.S. markets.”— Vaibhav Taneja, CFO

FSD has become a primary demand driver, with customers in approved regions effectively buying Tesla for the FSD capability rather than the vehicle itself, a shift from cars being the primary draw.

“they're actually buying Tesla full self-driving with a car attached as opposed to a car with FSD.”— Elon Musk, CEO

FSD adoption reached nearly 1.5 million paid customers globally, with 55% of North American deliveries having a subscription enabled at delivery, indicating rising attach rates versus prior periods.

Per Vaibhav Taneja, CFO

Optimus 4 is targeted for roughly 10x the production volume of Optimus 3, an aspirational scale-up to 10 million units per year from 1 million.

“aspirationally 10 million units a year versus 1 million units a year for Optimus 3”— Elon Musk, CEO

Multiple new products began production this quarter for the first time, including Cybercab, initial Optimus ramp, Tesla Semi, and the lithium and cathode refineries, marking a wave of new manufacturing starts.

“The Cybercab has started production, and we also have started production and are ramping in — we will soon start production with Optimus.”— Elon Musk, CEO

Autonomous Tesla Semi capability is now expected around year-end or early next year, but development will take a backseat for about six months to prioritize self-driving progress on Model 3, Y, and Cybercab.

“We expect to get self-driving working on the Tesla Semi probably around the end of this year or early next year.”— Elon Musk, CEO

Automotive gross margin excluding credits declined sequentially from 19.2% to 16.3%, though management said this would have been roughly flat excluding one-time warranty and tariff benefits recognized in the prior quarter.

“Controlling for the impact of those benefits from the prior quarter, our automotive gross margins, excluding credits, would have been approximately flat.”— Vaibhav Taneja, CFO

Energy gross margin fell sharply from 39.5% to 20.4% due to a warranty true-up, non-repeating tariff benefits, and declining industrial storage ASPs from rising competition; long-term margins are expected to normalize in the mid-to-low 20% range.

“Long term, we believe the energy business should normalize at a gross margin rate in the mid- to low-20% range.”— Vaibhav Taneja, CFO

Service and other gross margin improved sequentially from 9.2% to 14.1%, reaching an all-time high driven by higher volume and better fleet cost management.

“Service and other margins improved sequentially from 9.2% to 14.1%, an all-time high.”— Vaibhav Taneja, CFO

Operating expenses increased sequentially due to R&D ramp costs for Semi, Optimus, Cybercab, and AI compute depreciation plus litigation charges, and management expects opex, largely R&D-driven, to keep growing through 2026 and beyond.

“we expect our operating expenses largely driven by R&D to continue to grow in 2026 and beyond.”— Vaibhav Taneja, CFO

Federal AV regulation is becoming more favorable, with FMVSS rules moving toward acceptance of purpose-built autonomous vehicles, while some state-level rules such as in New Jersey are described as a new setback.

“we've made a lot of headway from the federal government in terms of the FMVSS rules moving towards acceptance and adoption of purely built AVs”— Lars Moravy, SVP, Vehicle Engineering

CapEx more than doubled sequentially in Q2 and is expected to rise further in the second half of 2026, with full-year CapEx guided above $25 billion and continued growth expected over the next two to three years.

“We continue to expect that CapEx for this year will be more than $25 billion.”— Vaibhav Taneja, CFO

Tesla newly secured debt facilities providing capacity to borrow up to $30 billion, a new financing tool to accelerate its investment plans beyond relying solely on cash.

“we are being opportunistic in securing certain debt facilities that will give us the capacity to borrow up to $30 billion”— Vaibhav Taneja, CFO

Rising interest rates increased the cost of interest rate subvention, which is recognized upfront as a revenue offset, creating a new negative drag on automotive margins versus prior periods.

“as interest rates have risen this year, the cost of subvention has risen along with them, which had a negative impact on automotive margins.”— Vaibhav Taneja, CFO

Commodity price increases are cited as an incremental cost pressure adding to expenses, alongside interest rate changes, versus prior quarters.

“Commodity price increases and interest rate changes all continue to add to our costs.”— Vaibhav Taneja, CFO