Tesla, Inc. stock research
FY2025 Q4
Tesla (TSLA) Gross Margin — Quarter Ended Dec 31, 2025
Gross profit is revenue minus cost of revenue, and gross margin is the ratio of gross profit to revenue. In the current quarter, gross margin improved compared to both the prior quarter and the same quarter last year.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2025 Q4
Gross profit is revenue minus cost of revenue, and gross margin is the ratio of gross profit to revenue. In the current quarter, gross margin improved compared to both the prior quarter and the same quarter last year.
- The strongest observable margin driver is the larger proportional decline in cost of revenue relative to the decline in revenue, which lifted the gross margin.
- Compared to the prior quarter, revenue was lower while gross profit was slightly lower, but cost of revenue decreased more sharply, resulting in a higher gross margin. Versus the same quarter one year ago, revenue was lower, gross profit was higher, and cost of revenue was lower, leading to an improved gross margin.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
20.1%
Gross profit
$5.0B
Revenue
$24.9B
Cost of revenue
$19.9B
Quarter-over-quarter change
+2.1 pts
Year-over-year change
+3.9 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 31, 2025 | $19.3B | $3.2B | $16.2B | 16.3% |
| Jun 30, 2025 | $22.5B | $3.9B | $18.6B | 17.2% |
| Sep 30, 2025 | $28.1B | $5.1B | $23.0B | 18.0% |
| Dec 31, 2025 | $24.9B | $5.0B | $19.9B | 20.1% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
+2.1 pts
Year-over-year change
Dec 31, 2024
+3.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the larger proportional decline in cost of revenue relative to the decline in revenue, which lifted the gross margin.
Compared to the prior quarter, revenue was lower while gross profit was slightly lower, but cost of revenue decreased more sharply, resulting in a higher gross margin. Versus the same quarter one year ago, revenue was lower, gross profit was higher, and cost of revenue was lower, leading to an improved gross margin.
Monitor the trend of cost of revenue as a percentage of revenue, as it directly influences gross margin movements.