Tesla Profits Plummet as Musk Focuses on AI, Robotics
Tesla reported its second consecutive year of declining revenue and profits, signaling a grim milestone for the electric vehicle manufacturer. The company's profit fell 46% in 2025, recording just $3.8 billion across the year, its lowest tally in years, according to a report released Wednesday. Total revenue from car sales also fell 11% year-over-year.
The decline comes as CEO Elon Musk increasingly focuses on transforming Tesla into a leader in artificial intelligence and robotics, according to The Verge. Tesla already revealed that it shipped 1.63 million cars globally across 2025. That marks the second year in a row that its sales have declined, after Musk spent years promising average annual growth of 50%.
Several factors contributed to Tesla's financial woes. Musk's involvement in the Trump administration and the elimination of federal electric vehicle subsidies by Congress caused sales to plummet, TechCrunch reported. The company has also lost ground to its Chinese competitors, according to The Verge.
In other economic news, the US Federal Reserve announced Wednesday that it would hold interest rates steady at around 3.6%, after lowering them three times last year, according to Euronews. The central bank cited a stabilized job market and "solid" economic growth as reasons for the decision, upgrading its assessment from "modest" growth last month.
Meanwhile, Microsoft reported strong cloud earnings in the second quarter of its 2026 fiscal year, with overall revenue up 17% to $81.3 billion and net income increasing by 23% to $30.9 billion, The Verge reported. However, Microsoft's More Personal Computing division was the only business unit to post a revenue decline this quarter.
In another development, music hardware and software manufacturer Native Instruments has entered into preliminary insolvency proceedings, according to Hacker News, leaving the future of the company behind iconic software like Massive, Traktor and Kontakt and hardware like Maschine uncertain. An administrator has been appointed to handle restructuring and potentially sell off existing assets. The company also owns the brands iZotope, Brainworx and Plugin Alliance.
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