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Tesla CEO Elon Musk has it been months — years? — is trying to position his company as more than just an electric vehicle manufacturer. When Tesla acquired Solar City in 2016, he (and his communications team) pitched it as a sustainable energy company. In the last year, he has been pushing the idea of Tesla as an artificial intelligence and robotics company.
Musk’s ambitious brand has been hit by financial reality: Most of its revenue comes from the sale of electric vehicles. Her latest earnings back it up.
The company generated revenue of $94.8 billion in 2025. Of that, $69.5 billion came from the sale and lease of electric vehicles and related regulatory credits. The remaining $25 billion is split roughly down the middle between the power generation (solar) and storage and “services and other” businesses, which include revenue from Superchargers, parts sales and Full Self-Driving subscriptions. This reliance on deliveries means that as EV sales decline, so does Tesla’s entire balance sheet. Its earnings in 2025 were 46% lower than the previous year.
Tesla has been trying to grow its non-electronics businesses to offset declining sales, and its Q4 and full-year earnings report (and accompanying invitation) signaled a shift away from lingering talk about robotic AI and toward action. Currently, this action involves spending money, not production. Musk has repeatedly stressed that 2026 will be a huge CapEx year, more than doubling spending to 20 billion dollarswhich would put them in negative cash flow territory.
For example, Musk announced that Tesla is ending production of the Model S and Model X, which is more symbolic than material. Those two models account for about 2% of Tesla’s sales volume, which Barclays analyst Dan Levy also does in his latest note. Still, it’s a remarkable end-of-an-era moment for Tesla and the wider auto industry, which changed forever when the Model S launched in 2012.
Moving more hardware is what Tesla plans to do now.
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Tesla plans to fill the production gap left by the Model S and X with Optimus humanoid robots, which will be built at its factory in Fremont, California. Musk also plans to scale Tesla’s robotaxi operations to more cities in 2026, and even confirmed the need for Tesla to build a TerraFab factory to bolster its chip supply.
But the thing that really stood out for me — and a real Elon Inc circular economy deal — was Tesla’s plan to invest $2 billion in another Musk company, xAI, and signaled plans to more closely align those two companies. Meanwhile, other outlets report that talks are underway for a possible merger (in some combination) of three of Musk’s companies: SpaceX, Tesla and xAI.
But let’s come back down to earth for a moment and review Tesla’s current business. Its sales are down year-on-year, while the smaller energy storage business posted positive earnings.
A little bird
We’re not ready to share the full details, but we’ve heard from a little birdie that there’s some activity on the fundraising front for Waymo. You probably saw it reference last month about Waymo raising up to $15 billion in a round led by parent company Alphabet. Based on my conversations, it’s still in the “realm” of $15 billion, and a lot of it is coming from Alphabet, and there’s a lot of interest from outside investors to get involved. A bird told me that one of the other investors might be an OEM (original equipment manufacturer.
Stay tuned for more on this.
Do you have a tip for us? Email Kirsten Korosec at kirsten.korosec@techcrunch.com or my Signal at kkorosec.07 or email Sean O’Kane at sean.okane@techcrunch.com.
Offers!
Waabi it gets my “deal of the week” badge – and not just because of the dollar figures attached. The autonomous vehicle startup has raised $750 million in a Series C round led by co-founder Khosla Ventures and G2 Venture Partnersplus another $250 million in milestone capital from Uber to support the deployment of 25,000 or more Waabi Driver bots exclusively on its platform.
Uber is already a supporter of Waabi, participating in one of its first raises in 2021. But this is about more than money. When Waabi first launched, it focused on applying its autonomous vehicle technology to self-driving trucks. The deal with Uber is a statement that it intends to scale its technology across multiple self-driving industries with a single technology stack.
Can Waabi do it? Others tried and gave way. Waymo shut down its self-driving truck program to focus on robotaxi. Dawnwhich is also an investor in Waabi, worked on both trucks and robotaxis before deciding to focus only on big rigs.
Other offers that caught my eye…
Gatik AIa startup developing autonomous trucks with a focus on the “middle mile,” has signed a deal with a major (unnamed) consumer goods company. Here’s why it matters: The contract will be delivered $600 million in revenue over five years. And these are for driverless transportation, meaning there is no safety driver behind the wheel. These Gatik trucks, which operate 24 hours a day, moving ambient, refrigerated and frozen products between distribution centers and stores, will operate without a driver from mid-2025. According to the company, it has completed 60,000 orders completely without a driver without any problems.
of Luminar The lidar business has been sold for $33 million in Redmond, Washington MicroVision. The company, which develops its own sensors, beat out Quantum Computing in an auction for the assets. TC’s Sean O’Kane interviewed MicroVision CEO Glen DeVos about his plans for Luminar. The sale process did have some last-minute intrigue when a mystery bidder, with a much higher offer, made a play for Luminar’s lidar business.
Rad Power Bikeswhich began bankruptcy proceedings about a month ago, has reached an agreement to be sold to Life Electric Vehicles Holdings (or Life EV) for about $13.2 million. When calculating Rad Power’s liabilities, the total value of the offer is $14.9 million. History lesson: Rad Power has raised $329.2 million since inception and was once valued at $1.65 billion.
Redwood materials raised $425 million in a Series E round that includes Google as a new investor. The round was led by venture capital firm Eclipse and includes a strategic investment from Nvidia’s venture capital arm, NVentures, as well as existing investors Capricorn and Goldman Sachs. Read the full story to find out what Redwood plans to do with the capital.
Notable reads and other items
Magica company that aggregates real-time prices and pickup times across multiple ride-hailing services has shared new data on ride-hailing and robotaxis in the San Francisco Bay Area. There are a few takeaways — so read the full story — including that the price gap between Waymo and rides provided by Uber and Lyft is narrowing.
Uber launched a new division called Uber AV Labs ie not — as senior reporter Sean O’Kane points out — a ploy to start developing its own robotics again. This is a data sharing game. Uber cars equipped with sensors will collect and then share data with partners like Lucid, Waymo and Waabi. Important note: No contracts have been signed yet.
Waymo a robotaxi service is now allowed to operate to and from San Francisco International Airport (SFO). The company will begin offering access to SFO to a select number of riders before rolling it out to all customers in the coming months. However, this victory comes with a bit of tarnish. Waymo is under investigation by the National Road Safety Agency and National Transportation Safety Board after the company reported that one of its robots hit a child near an elementary school in Santa Monica on January 23.
THE San Francisco Police Departmentinvestigates an incident involving a Zoox autonomous vehicle crashed into the driver’s door of a parked car.
One more thing…
It’s been a few weeks since we’ve had a poll, and here’s a fun one: What will the name or ticker be for Musk’s combined conglomerate?
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