Profit & Margins

Q2 2026 note

Tesla now produces substantial gross profit with a weaker profit engine: the business has broadened beyond autos, but that broader mix has not restored the margin or profit per vehicle seen at its peak. Total business-line gross profit was about $6.2 billion in Q4 2022 versus $4.9 billion in Q2 2026 (chart 6), while gross margin fell from its 29% peak to 16.8% (chart 20). Auto gross profit per vehicle declined from $15,800 to $6,650 (chart 24), as the selling-price-to-cost gap narrowed from about $16,000 to $6,650 (chart 23). Energy's share of gross profit rose from 4% to 16% (chart 9), and its margin was 20.4% in Q2 2026 (chart 22). These figures point to diversification cushioning weaker auto profitability, not replacing it. The higher Energy contribution and positive Services margin help explain why gross profit remains large, but the lower total margin and profit per car show that the mix has not recovered the earlier level of earnings from each dollar of sales or each vehicle.