Tesla reported a record 14.2 GWh of energy storage deployments in the fourth quarter of 2025, up 29% from the previous year, even as its electric vehicle deliveries fell 16%. The company's energy business, including Powerwall and Megapack products, continues to show strong growth and profit margins. CEO Elon Musk highlighted the long-term potential of energy storage and solar integration.
Tesla's energy storage segment reached a milestone in the fourth quarter of 2025, deploying 14.2 GWh of stationary batteries, which contributed to a full-year total of 46.7 GWh—a 49% increase from 2024. This surge offset a 16% year-over-year drop in vehicle deliveries during the same period, amid broader challenges in the EV market.
North American EV sales plummeted 46% from the third quarter record, following the expiration of U.S. tax credits for consumer purchases and leases, according to Cox Automotive. Globally, however, EV sales grew by about 20% in 2025. Tesla's Chief Financial Officer Vaibhav Taneja noted strong demand across all regions for the company's Powerwall home batteries and Megapack grid-scale systems, marking the fifth consecutive quarter of record profit margins.
The company is expanding production capacity, with plans to start Megapack manufacturing at a new facility near Houston this year, aiming for up to 50 GWh annually. Tesla already operates 80 GWh of combined capacity at factories in California and China. "We are building more manufacturing capacity and expect that energy will have very high growth for as far into the future as we can imagine," Musk stated.
Korean competitors LG Energy Solution and Samsung SDI also reported robust stationary storage demand, which helped mitigate slowing North American EV sales. LG anticipates energy storage production to grow four times faster than EV production in 2026, targeting 90 GWh in orders and over 60 GWh in capacity—80% in North America—fueled by utility contracts and data center investments.
Musk emphasized complementary opportunities in solar, saying, "The solar opportunity is underestimated. We think the best way to add significant capability to the grid is solar and batteries on Earth and solar in space." Tesla aims to scale to 100 GW of annual solar cell production, though analysts question the near-term feasibility.