Tesla Q2 Profit Drops Amid Boycotts, Competition

Tesla reported a 12% decline in revenue to $22.5 billion and a 16% drop in profit for the second quarter of 2025, marking its sharpest sales fall in over a decade and its third consecutive quarter of declining profits. The downturn is attributed to falling vehicle deliveries, reduced regulatory credit revenue, lower average selling prices, and intensifying competition from both established automakers and Chinese rivals. Significant brand damage linked to CEO Elon Musk's controversial political activities has led to consumer boycotts and weakened Tesla's appeal among key market segments. While the services segment, including Supercharging, showed some growth, it was insufficient to offset broader losses. Tesla continues to invest in robotaxi and AI initiatives, though these remain in early stages and have not yet contributed meaningfully to profits. The company also faces mounting regulatory and legal pressures, particularly in California over Autopilot advertising claims.