Tesla's Revenue Falls 12% to $22.5 Billion, Business Decline Confirmed by Ross Gerber

Tesla's business is in decline, according to Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management. Tesla's second-quarter earnings missed expectations, with revenue falling 12% to $22.5 billion. Gerber says it's sad but acknowledges the decline in business.

Tesla's business continues to face significant challenges, according to Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management. The electric vehicle maker reported its second-quarter earnings on July 23, 2025, with revenue falling 12% to $22.5 billion, missing Wall Street's expectations of $22.7 billion [1]. The company's operating income also decreased by 42% to $0.9 billion, marking a second straight quarterly decline [1].

Gerber, speaking on "Bloomberg The Close," described Tesla's business as being in decline. He noted that the company's second-quarter earnings missed expectations and that revenue fell 12% to $22.5 billion [2]. Despite a strong finish to the quarter, Tesla's automotive revenue declined by 16.6% year-on-year, from $19.9 billion in Q2 2024 to $16.6 billion in Q2 2025 [3]. The company's net income stood at $1.17 billion, down 17% year-on-year [3].

The decline in Tesla's business has been attributed to several factors. The company has faced falling stock prices, steep competition, and a CEO whose leadership style has been described as erratic [1]. Additionally, Tesla's vehicle deliveries fell by 14% in Q2 2025 compared to Q2 2024 [3]. The company's cash reserves dipped by $200 million to $36.8 billion, and its free cash flow stood at just $100 million during the quarter [3].

Tesla has responded to these challenges by launching more affordable models and offering discounts and financing incentives across all its models [3]. However, the company faces further sales challenges in the US due to rising competition in China and Europe, as well as federal incentives for EVs set to expire by September-end due to Trump's bill [3].

The decline in Tesla's business has been partially attributed to Elon Musk's role in Donald Trump's administration as the de facto head of the "department of government efficiency" (Doge). Musk led the charge to downsize the federal government, getting rid of various agencies and instituting layoffs in nearly all departments. This sparked mass countrywide protests against Tesla and demands to boycott the company [1].

Despite these challenges, Musk remains optimistic about Tesla's future. He has said that the company has a shot of being the most valuable company in the world and that it is being "extremely paranoid" about safety with its driverless robotaxis [1].

References:
[1] https://www.theguardian.com/us-news/2025/jul/23/tesla-second-quarter-earnings-elon-musk
[2] https://www.newsbytesapp.com/news/business/tesla-posts-22-5-billion-revenue-for-q2-2025-down-12/story
[3] https://www.marketscreener.com/news/tesla-s-business-is-in-decline-says-ross-gerber-ce7c5cd3dd81f722