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And four more things we learned from Tesla’s Q1 earnings call.

Tesla doesn’t want to talk about its cars — or at least, not about the cars that have steering wheels and human drivers.
Despite weeks of reports about Tesla’s manufacturing and sales woes — price cuts, recalls, and whether a new, cheaper model would ever come to fruition — CEO Elon Musk and other Tesla executives devoted their quarterly earnings call largely to the company's autonomous driving software. Musk promised that the long-awaited program would revolutionize the auto industry (“We’re putting the actual ‘auto’ in automobile,” as he put it) and lead to the “biggest asset appreciation in history” as existing Tesla vehicles got progressively better self-driving capabilities.
In other Tesla news, car sales are falling, and a new, cheaper vehicle will not be constructed on an all-new platform and manufacturing line, which would instead by reserved for a from-the-ground-up autonomous vehicle.
Here are five big takeaways from the company's earnings and conference call.
The company reported that its “total automotive revenues” came in at $17.4 billion in the first quarter, down 13% from a year ago. Its overall revenues of $21.3 billion, meanwhile, were down 9% from a year ago. The earnings announcement included a number of explanations for the slowdown, which was even worse than Wall Street analysts had expected.
Among the reasons Tesla cited for the disappointing results were arson at its Berlin factory, the obstruction to Red Sea shipping due to Houthi attacks from Yemen, plus a global slowdown in electric vehicle sales “as many carmakers prioritize hybrids over EVs.” The combined effects of these unfortunate events led the company to undertake a well-publicized series of price cuts and other sweeteners for buyers, which dug further into Tesla’s bottom line. Tesla’s chief financial officer, Vaibhav Taneja, said that the company’s free cash flow was negative more than $2 billion, largely due to a “mismatch” between its manufacturing and actual sales, which led to a buildup of car inventory.
The bad news was largely expected — the company’s shares had fallen 40% so far this year leading up to the first quarter earnings, and the past few weeks have featured a steady drumbeat of bad news from the automaker, including layoffs and a major recall. The company’s profits of $1.1 billion were down by more than 50%, short of Wall Street’s expectations — and yet still, Tesla shares were up more than 10% in after-hours trading following the shareholder update and earnings call.
The strange thing about Tesla is that it makes the overwhelming majority of its money from selling cars, but has become the world’s most valuable car company thanks to investors thinking that it’s more of an artificial intelligence company. It’s not uncommon for Tesla CEO Elon Musk and his executives to start talking about their Full Self-Driving technology and autonomous driving goals when the company’s existing business has hit a rough patch, and today was no exception.
Tesla’s value per share was about 33 times its earnings per share by the end of trading on Monday, comparable to how investors evaluate software companies that they expect to grow quickly and expand profitability in the future. Car companies, on the other hand, tend to have much lower valuations compared to their earnings — Ford’s multiple is 12, for instance, and GM’s is 6.
Musk addressed this gap directly on the company’s earnings call. He said that Tesla “should be thought of as an AI/robotics company,” and that “if you value Tesla as an auto company, that’s the wrong framework.” To emphasize just how much the company is pivoting around its self-driving technology, Musk said that “if somebody believes Tesla is not going to solve autonomy they should not be an investor in the company.”
One reason investors value Tesla so differently relative to its peers is that they do, actually, expect the company will make a lot of money using artificial intelligence. No doubt with that in mind, executives made sure to let everyone know that its artificial intelligence spending was immense: The company’s free cash flow may have been negative more than $2 billion, but $1 billion of that was in spending on AI infrastructure. The company also said that it had “increased AI training compute by more than 130%” in the first quarter.
“The future is not only electric, but also autonomous,” the company’s investor update said. “We believe scaled autonomy is only possible with data from millions of vehicles and an immense AI training cluster. We have, and continue to expand, both.”
Musk described the company’s FSD 12 self-driving software as “profound” and said that “it’s only a matter of time before we exceed the reliability of humans, and not much time at that.”
The biggest open question about Tesla is what would happen with its long-promised Model 2, a sub-$30,000 EV that would, in theory, have mass appeal. Reuters reported that the project had been cancelled and that Tesla was instead devoting its resources to another long-promised project, a self-driving ride-hailing vehicle called the “robotaxi.”
Musk tweeted that Reuters was “lying” but never directly denied the report or identified what was wrong with it, instead saying that the robotaxi would be unveiled in August. He later followed up to say that “going balls to the wall for autonomy is a blindingly obvious move. Everything else is like variations on a horse carriage.”
Before the call, Wall Street analysts were begging for a confirmation that newer, cheaper models besides a robotaxi were coming.
“If Tesla does not come out with a Model 2 the next 12 to 18 months, the second growth wave will not come,” Wedbush Securities analyst Dan Ives wrote in a note last week. “Musk needs to recommit to the Model 2 strategy ALONG with robotaxis but it CANNOT be solely replaced by autonomy.”
Anyone who expected to get their answers on today’s call, though, was likely kidding themselves.
Tesla announced today it had updated its planned vehicle line-up to “accelerate the launch of new models ahead of our previously communicated start of production in the second half of 2025,” and that “these new vehicles, including more affordable models, will utilize aspects of the next generation platform as well as aspects of our current platforms.” Musk added on the company’s earnings call that a new model would not be “contingent on any new factory or massive new production line.”
Some analysts attributed the share pricing popping after hours to this line, although it’s unclear just how new this new car would be.
Tesla’s shareholder update indicated that any new, cheaper vehicle would not necessarily be entirely new nor unlock massive new savings through an all-new production process. “This update may result in achieving less cost reduction than previously expected but enables us to prudently grow our vehicle volumes in a more capex efficient manner during uncertain times,” the update said.
Of the robotaxi, meanwhile, the company said it will “continue to pursue a revolutionary ‘unboxed’ manufacturing strategy,” indicating that just the ride-hailing vehicle would be built entirely on a new platform.
Musk also discussed how a robotaxi network could work, saying that it would be a combination of Tesla-operated robotaxis and owners putting their own cars into the ride-hailing fleet. When asked directly about its schedule for a $25,000 car, Musk quickly pivoted to discussing autonomy, saying that when Teslas are able to self-drive without supervision, it will be “the biggest asset appreciation in history,” as existing Teslas became self-driving.
When asked whether any new vehicles would “tweaks” or “new models,” Musk dodged the question, saying that they had said everything they had planned to say on the new cars.
One bright spot on the company’s numbers was the growth in its sales of energy systems, which are tilting more and more toward the company’s battery offerings.
Tesla said it deployed just over 4 gigawatts of energy storage in the first quarter of the year, and that its energy revenue was up 7% from a year ago. Profits from the business more than doubled.
Tesla’s energy business is growing faster than its car business, and Musk said it will continue to grow “significantly faster than the car business” going forward.
Revenues from “services and others,” which includes the company’s charging network, was up by a quarter, as more and more other electric vehicle manufacturers adopt Tesla’s charging standard.
Another speculative Tesla project is Optimus, which the company describes as a “general purpose, bi-pedal, humanoid robot capable of performing tasks that are unsafe, repetitive or boring.” Like many robotics projects, the most the public has seen of Optimus has been intriguing video content, but Musk said that it was doing “factory tasks in the lab” and that it would be in “limited production” in a factory doing “useful tasks” by the end of this year. External sales could begin “by the end of next year,” Musk said.
But as with any new Tesla project, these dates may be aspirational. Musk described them as “just guesses,” but also said that Optimus could “be more valuable than everything else combined.”
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There has been no new nuclear construction in the U.S. since Vogtle, but the workers are still plenty busy.
The Trump administration wants to have 10 new large nuclear reactors under construction by 2030 — an ambitious goal under any circumstances. It looks downright zany, though, when you consider that the workforce that should be driving steel into the ground, pouring concrete, and laying down wires for nuclear plants is instead building and linking up data centers.
This isn’t how it was supposed to be. Thousands of people, from construction laborers to pipefitters to electricians, worked on the two new reactors at the Plant Vogtle in Georgia, which were intended to be the start of a sequence of projects, erecting new Westinghouse AP1000 reactors across Georgia and South Carolina. Instead, years of delays and cost overruns resulted in two long-delayed reactors 35 miles southeast of Augusta, Georgia — and nothing else.
“We had challenges as we were building a new supply chain for a new technology and then workforce,” John Williams, an executive at Southern Nuclear Operating Company, which owns over 45% of Plant Vogtle, said in a webinar hosted by the environmental group Resources for the Future in October.
“It had been 30 years since we had built a new nuclear plant from scratch in the United States. Our workforce didn’t have that muscle memory that they have in other parts of the world, where they have been building on a more regular frequency.”
That workforce “hasn’t been building nuclear plants” since heavy construction stopped at Vogtle in 2023, he noted — but they have been busy “building data centers and car manufacturing in Georgia.”
Williams said that it would take another “six to 10” AP1000 projects for costs to come down far enough to make nuclear construction routine. “If we were currently building the next AP1000s, we would be farther down that road,” he said. “But we’ve stopped again.”
J.R. Richardson, business manager and financial secretary of the International Brotherhood of Electric Workers Local 1579, based in Augusta, Georgia, told me his union “had 2,000 electricians on that job,” referring to Vogtle. “So now we have a skill set with electricians that did that project. If you wait 20 or 30 years, that skill set is not going to be there anymore.”
Richardson pointed to the potential revitalization of the failed V.C. Summer nuclear project in South Carolina, saying that his union had already been reached out to about it starting up again. Until then, he said, he had 350 electricians working on a Meta data center project between Augusta and Atlanta.
“They’re all basically the same,” he told me of the data center projects. “They’re like cookie cutter homes, but it’s on a bigger scale.”
To be clear, though the segue from nuclear construction to data center construction may hold back the nuclear industry, it has been great for workers, especially unionized electrical and construction workers.
“If an IBEW electrician says they're going hungry, something’s wrong with them,” Richardson said.
Meta’s Northwest Louisiana data center project will require 700 or 800 electricians sitewide, Richardson told me. He estimated that of the IBEW’s 875,000 members, about a tenth were working on data centers, and about 30% of his local were on a single data center job.
When I asked him whether that workforce could be reassembled for future nuclear plants, he said that the “majority” of the workforce likes working on nuclear projects, even if they’re currently doing data center work. “A lot of IBEW electricians look at the longevity of the job,” Richardson told me — and nuclear plants famously take a long, long time to build.
America isn’t building any new nuclear power plants right now (though it will soon if Rick Perry gets his way), but the question of how to balance a workforce between energy construction and data center projects is a pressing one across the country.
It’s not just nuclear developers that have to think about data centers when it comes to recruiting workers — it’s renewables developers, as well.
“We don’t see people leaving the workforce,” said Adam Sokolski, director of regulatory and economic affairs at EDF Renewables North America. “We do see some competition.”
He pointed specifically to Ohio, where he said, “You have a strong concentration of solar happening at the same time as a strong concentration of data center work and manufacturing expansion. There’s something in the water there.”
Sokolski told me that for EDF’s renewable projects, in order to secure workers, he and the company have to “communicate real early where we know we’re going to do a project and start talking to labor in those areas. We’re trying to give them a market signal as a way to say, We’re going to be here in two years.”
Solar and data center projects have lots of overlapping personnel needs, Sokolski said. There are operating engineers “working excavators and bulldozers and graders” or pounding posts into place. And then, of course, there are electricians, who Sokolski said were “a big, big piece of the puzzle — everything from picking up the solar panel off from the pallet to installing it on the racking system, wiring it together to the substations, the inverters to the communication systems, ultimately up to the high voltage step-up transformers and onto the grid.”
On the other hand, explained Kevin Pranis, marketing manager of the Great Lakes regional organizing committee of the Laborers’ International Union of North America, a data center is like a “fancy, very nice warehouse.” This means that when a data center project starts up, “you basically have pretty much all building trades” working on it. “You’ve got site and civil work, and you’re doing a big concrete foundation, and then you’re erecting iron and putting a building around it.”
Data centers also have more mechanical systems than the average building, “so you have more electricians and more plumbers and pipefitters” on site, as well.
Individual projects may face competition for workers, but Pranis framed the larger issue differently: Renewable energy projects are often built to support data centers. “If we get a data center, that means we probably also get a wind or solar project, and batteries,” he said.
While the data center boom is putting upward pressure on labor demand, Pranis told me that in some parts of the country, like the Upper Midwest, it’s helping to compensate for a slump in commercial real estate, which is one of the bread and butter industries for his construction union.
Data centers, Pranis said, aren’t the best projects for his members to work on. They really like doing manufacturing work. But, he added, it’s “a nice large load and it’s a nice big building, and there’s some number of good jobs.”
A conversation with Dustin Mulvaney of San Jose State University
This week’s conversation is a follow up with Dustin Mulvaney, a professor of environmental studies at San Jose State University. As you may recall we spoke with Mulvaney in the immediate aftermath of the Moss Landing battery fire disaster, which occurred near his university’s campus. Mulvaney told us the blaze created a true-blue PR crisis for the energy storage industry in California and predicted it would cause a wave of local moratoria on development. Eight months after our conversation, it’s clear as day how right he was. So I wanted to check back in with him to see how the state’s development landscape looks now and what the future may hold with the Moss Landing dust settled.
Help my readers get a state of play – where are we now in terms of the post-Moss Landing resistance landscape?
A couple things are going on. Monterey Bay is surrounded by Monterey County and Santa Cruz County and both are considering ordinances around battery storage. That’s different than a ban – important. You can have an ordinance that helps facilitate storage. Some people here are very focused on climate change issues and the grid, because here in Santa Cruz County we’re at a terminal point where there really is no renewable energy, so we have to have battery storage. And like, in Santa Cruz County the ordinance would be for unincorporated areas – I’m not sure how materially that would impact things. There’s one storage project in Watsonville near Moss Landing, and the ordinance wouldn’t even impact that. Even in Monterey County, the idea is to issue a moratorium and again, that’s in unincorporated areas, too.
It’s important to say how important battery storage is going to be for the coastal areas. That’s where you see the opposition, but all of our renewables are trapped in southern California and we have a bottleneck that moves power up and down the state. If California doesn’t get offshore wind or wind from Wyoming into the northern part of the state, we’re relying on batteries to get that part of the grid decarbonized.
In the areas of California where batteries are being opposed, who is supporting them and fighting against the protests? I mean, aside from the developers and an occasional climate activist.
The state has been strongly supporting the industry. Lawmakers in the state have been really behind energy storage and keeping things headed in that direction of more deployment. Other than that, I think you’re right to point out there’s not local advocates saying, “We need more battery storage.” It tends to come from Sacramento. I’m not sure you’d see local folks in energy siting usually, but I think it’s also because we are still actually deploying battery storage in some areas of the state. If we were having even more trouble, maybe we’d have more advocacy for development in response.
Has the Moss Landing incident impacted renewable energy development in California? I’ve seen some references to fears about that incident crop up in fights over solar in Imperial County, for example, which I know has been coveted for development.
Everywhere there’s batteries, people are pointing at Moss Landing and asking how people will deal with fires. I don’t know how powerful the arguments are in California, but I see it in almost every single renewable project that has a battery.
Okay, then what do you think the next phase of this is? Are we just going to be trapped in a battery fire fear cycle, or do you think this backlash will evolve?
We’re starting to see it play out here with the state opt-in process where developers can seek state approval to build without local approval. As this situation after Moss Landing has played out, more battery developers have wound up in the opt-in process. So what we’ll see is more battery developers try to get permission from the state as opposed to local officials.
There are some trade-offs with that. But there are benefits in having more resources to help make the decisions. The state will have more expertise in emergency response, for example, whereas every local jurisdiction has to educate themselves. But no matter what I think they’ll be pursuing the opt-in process – there’s nothing local governments can really do to stop them with that.
Part of what we’re seeing though is, you have to have a community benefit agreement in place for the project to advance under the California Environmental Quality Act. The state has been pretty strict about that, and that’s the one thing local folks could still do – influence whether a developer can get a community benefits agreement with representatives on the ground. That’s the one strategy local folks who want to push back on a battery could use, block those agreements. Other than that, I think some counties here in California may not have much resistance. They need the revenue and see these as economic opportunities.
I can’t help but hear optimism in your tone of voice here. It seems like in spite of the disaster, development is still moving forward. Do you think California is doing a better or worse job than other states at deploying battery storage and handling the trade offs?
Oh, better. I think the opt-in process looks like a nice balance between taking local authority away over things and the better decision-making that can be brought in. The state creating that program is one way to help encourage renewables and avoid a backlash, honestly, while staying on track with its decarbonization goals.
The week’s most important fights around renewable energy.
1. Nantucket, Massachusetts – A federal court for the first time has granted the Trump administration legal permission to rescind permits given to renewable energy projects.
2. Harvey County, Kansas – The sleeper election result of 2025 happened in the town of Halstead, Kansas, where voters backed a moratorium on battery storage.
3. Cheboygan County, Michigan – A group of landowners is waging a new legal challenge against Michigan’s permitting primacy law, which gives renewables developers a shot at circumventing local restrictions.
4. Klamath County, Oregon – It’s not all bad news today, as this rural Oregon county blessed a very large solar project with permits.
5. Muscatine County, Iowa – To quote DJ Khaled, another one: This county is also advancing a solar farm, eliding a handful of upset neighbors.