Tesla $TSLA reported $477 million in net income for the first quarter of 2026 on Wednesday, up 17% from $409 million a year earlier, as revenue rose 16% to $22.39 billion.
The company produced 408,386 vehicles but delivered only 358,023 — a gap of more than 50,000 units — pushing global vehicle inventory to 27 days of supply, up from 15 days at the end of the fourth quarter.
Non-GAAP earnings per share came in at $0.41, up 52% year over year. Free cash flow reached $1.44 billion. The gross margin expanded to 21.1%, up from 16.3% in the first quarter of 2025.
The quarter's $22.39 billion in revenue fell short of the $22.6 billion Wall Street had forecast, according to Reuters.
Shares climbed roughly 3.4% in after-hours trading.
The Model 3 and Model Y accounted for 341,893 of the quarter's 358,023 deliveries. Year-over-year delivery growth of 6.3% comes with an asterisk. The comparable period in 2025 was itself a weak quarter that had fallen below 2024 figures. Active FSD subscriptions reached 1.28 million, up 51% year over year, Tesla said.
Energy generation and storage revenue fell 12% from a year earlier to $2.41 billion. Storage deployed came in at 8.8 gigawatt hours, down from a record 14.2 GWh in the fourth quarter of 2025 and below the 10.4 GWh deployed in the first quarter of 2025.
Tesla said it began meaningful customer deployments of its first in-house designed solar panel, and expanded its Supercharger network to 8,463 stations, up 19% year over year. Paid Robotaxi miles almost doubled sequentially in the quarter, and in April, unsupervised robotaxi service went live in Dallas and Houston, adding to the Austin operation Tesla established last year. Separately, Tesla said Dutch regulator RDW has informed the European Commission of its intent to pursue bloc-wide authorization for Tesla's Full Self-Driving system.
Tesla said preparations for its first large-scale Optimus robot factory will begin in the second quarter, replacing the Model S and Model X $TWTR lines at its Fremont facility. A second-generation line at Gigafactory Texas is being designed for long-term annual production capacity of 10 million robots.
Production of the Model S and Model X has been wound down entirely, The New York Times reported. Tesla's core automotive lineup has narrowed as it prepares for the planned volume production of both Cybercab and the Tesla Semi this year. Battery pack capacity remains a limiting factor on vehicle production ramp, the company said.
Tesla's first quarter results follow a difficult fourth quarter of 2025 in which net income dropped 61% year over year and automotive revenue slid 11%, making 2025 the company's first year with an annual revenue decline. In that earnings call, CEO Elon Musk pivoted investor attention toward robotaxis, Optimus, and artificial intelligence. The first-quarter delivery shortfall had already weighed on Tesla stock before Wednesday's earnings report, sending it lower in early trading after the April 2 release of production and delivery figures.