Tesla Energy — FY2024 at a Glance

NASDAQ: TSLA · Founded 2003 · Austin, Texas, USA
Total revenue (company-wide)
$97,690 M
YoY change
+1 %
Net income (attrib.)
$7,091 M (−53 %)
Energy segment revenue
$10,086 M (+67 %)
Energy segment gross profit
$2,640 M (+131 %)
Energy segment gross margin
26.2 % (up from 18.9 %)
Energy storage deployments
31.4 GWh (+114 %)
Employees
125,665

Key takeaways

  • Tesla deployed 31.4 GWh of energy storage in 2024, more than doubling the 14.7 GWh shipped in 2023 and establishing the company as one of the world’s largest utility-scale storage integrators.
  • Energy segment revenue reached $10.1 billion, up 67 % year-on-year, making energy the fastest-growing business within Tesla and accounting for roughly 10 % of company-wide revenue.
  • Energy segment gross margin jumped to 26.2 %, up from 18.9 % in 2023 — driven by manufacturing cost reductions and $756 million in IRA manufacturing credits recognized in cost of goods sold.
  • Megafactory expansion advanced on two fronts: the Lathrop, California facility continued ramping while a second Megafactory in Shanghai moved toward production.
  • Unsatisfied performance obligations in the energy segment exceeded $7.18 billion for contracts with an original expected length of more than one year, of which $4.51 billion is expected to be recognized in the next 12 months, signaling a deep pipeline of contracted utility-scale projects.

1. Headline numbers

Tesla reported total revenue of $97.7 billion for the year ended December 31, 2024, up just 1 % from the prior year. Net income fell 53 % to $7.1 billion, reflecting margin compression across the automotive business due to price cuts and incentives.

Against that backdrop, the energy segment stood out. Energy revenue grew 67 % to $10.1 billion, and energy gross profit more than doubled to $2.6 billion. Company-wide gross margin was 17.9 %, but the energy segment outperformed at 26.2 %. R&D spending across all segments was $4.54 billion.

The contrast is stark: Tesla’s automotive core stagnated while its energy storage business delivered the kind of growth more commonly associated with earlier-stage companies.

2. Energy storage deployments: 31.4 GWh

Tesla deployed 31.4 GWh of energy storage products in FY2024, up 114 % from 14.7 GWh in FY2023. The company attributed the increase primarily to higher Megapack and Powerwall volumes.

To put this in context, 31.4 GWh places Tesla in the top tier of global energy storage system deployments. CATL shipped 93 GWh of ESS batteries in its FY2024 (calendar year 2024), though that figure covers cell shipments to third-party integrators rather than fully integrated systems. EVE Energy shipped approximately 71 GWh of ESS cells in the same period. Sungrow, a closer comparison as a system integrator rather than cell manufacturer, shipped 28 GWh. Tesla’s deployments thus rival Sungrow’s in scale, though the two companies address partially different markets — Tesla sells the Megapack as a turnkey DC block, while Sungrow offers a broader range of inverter-plus-battery configurations.

Tesla does not disclose a Megapack vs. Powerwall split for its 31.4 GWh figure, which limits granular analysis. Given that each Megapack unit stores approximately 4 MWh and each Powerwall about 13.5 kWh, the vast majority of deployed gigawatt-hours almost certainly came from Megapack.

3. Energy segment revenue and margins

Energy segment revenue of $10.1 billion represented approximately 10.3 % of Tesla’s total revenue, up from 6.2 % in FY2023. The segment’s 67 % revenue growth on 114 % deployment growth implies a decline in average revenue per GWh — consistent with Megapack price competition and the industry-wide trend of declining per-kWh system costs.

The margin story is more compelling. Energy segment gross margin expanded from 18.9 % to 26.2 %, an improvement of 730 basis points. Tesla cited three drivers: manufacturing cost reductions, benefits from IRA manufacturing credits, and a higher proportion of storage in the energy segment mix.

At 26.2 %, Tesla’s energy margin compares favorably with peers. CATL’s ESS segment achieved a 26.71 % gross margin in its 2025 fiscal year on cell sales. Sungrow reported a 36.69 % gross margin in its energy storage segment, though Sungrow’s margin includes higher-margin inverter products alongside storage systems. Tesla does not report operating income at the segment level — the 10-K uses gross profit as its segment profitability measure — so a direct operating margin comparison is not possible.

4. Megafactory expansion

Tesla’s Megapack production is centered on its Megafactory in Lathrop, California, which continued ramping through 2024. The company also disclosed that a second Megafactory in Shanghai was ramping production.

The 10-K does not disclose production capacity in GWh terms for either facility. However, Tesla indicated it expects capital expenditures to exceed $11 billion in 2025 and in each of the following two years, driven in part by energy storage manufacturing expansion alongside AI and automotive investments.

The Shanghai Megafactory, once operational, will give Tesla local manufacturing capability in the world’s largest energy storage market. China accounted for $20.9 billion (21.4 %) of Tesla’s total revenue in FY2024, though this figure is company-wide with no energy segment geographic breakdown available.

5. Product developments

Megapack

Megapack remains Tesla’s flagship energy storage product — a 4 MWh DC-coupled battery system designed for utility-scale deployments. Projects increasingly group dozens or hundreds of Megapack units into installations measured in GWh. The 31.4 GWh deployment figure for FY2024 implies Tesla shipped thousands of Megapack units during the year, though exact unit counts are not disclosed.

Tesla’s vertically integrated approach — designing the battery module, thermal management, power electronics, and software in-house — differentiates the Megapack from competing DC blocks that rely on third-party cells and BMS. However, this also means Tesla’s margins are exposed to upstream cell costs in ways that pure integrators using purchased cells are not.

Powerwall 3

Tesla introduced Powerwall 3 in 2024, its latest residential battery system. While the residential segment contributes a small fraction of total energy storage GWh deployed, it extends Tesla’s brand into the distributed energy market and complements its solar business.

The 10-K does not break out Powerwall revenue or unit shipments separately, so it is not possible to assess the residential product’s standalone financial contribution.

6. IRA manufacturing credits

A significant factor in the margin expansion was $756 million in IRA (Inflation Reduction Act) manufacturing credits recognized as a reduction in cost of goods sold during FY2024, compared to just $115 million in FY2023. These credits apply to domestically manufactured battery components and energy storage systems.

The $756 million in credits is material — it represents roughly 29 % of the energy segment’s $2.6 billion gross profit. While the credits are a direct benefit of Tesla’s US manufacturing footprint, they also create a dependency: any future reduction or phase-out of IRA incentives would directly pressure energy segment margins. This is a factor that distinguishes Tesla from Chinese competitors like CATL and EVE Energy, which do not benefit from US manufacturing credits but face lower labor and facility costs.

7. Market context

Tesla’s energy storage results reflect the broader surge in global utility-scale battery deployment. Several dynamics are shaping the competitive landscape:

The utility-scale BESS market is rapidly scaling, driven by rising renewable penetration, grid reliability requirements, and declining battery costs. Tesla’s Megapack competes directly with products from BYD, Sungrow, CATL (through its TENER line), and a growing roster of Chinese integrators entering international markets.

Geographic revenue breakdown for Tesla overall shows a roughly even split between the US (48.9 %), China (21.4 %), and other international markets (29.7 %). The company does not provide this breakdown at the energy segment level, making it difficult to assess where Megapack revenues are concentrated. Industry reporting suggests a significant portion of Tesla’s energy storage deployments are in North America and Australia.

The $7.18 billion in unsatisfied performance obligations for contracts with an original expected length of more than one year, of which $4.51 billion is expected to be recognized in the next 12 months, provides a window into Tesla’s contracted pipeline. While this figure includes both energy generation and storage contracts without separation, it signals substantial forward visibility for the energy business.

8. What to watch

Tesla’s energy segment outgrew the rest of the company by a wide margin in FY2024, and several developments bear watching in the periods ahead.

IRA credit dependency is a double-edged sword. The $756 million in manufacturing credits accounted for a material share of energy segment gross profit. If US policy shifts reduce or eliminate these credits, Tesla’s energy margins could contract meaningfully from the 26.2 % reported in FY2024. On the other hand, as long as credits remain available, Tesla’s US manufacturing base is a genuine competitive advantage over imported products.

Shanghai Megafactory changes the competitive equation. Local production in China would allow Tesla to compete on cost with domestic incumbents like CATL and BYD in the world’s largest energy storage market. The ramp timeline and initial capacity have not been disclosed, but any meaningful volume from Shanghai would be a significant development.

Revenue per GWh is declining. Energy revenue grew 67 % on 114 % deployment growth, implying a roughly 22 % decline in average revenue per GWh. This trend mirrors the broader industry — Sungrow, EVE, and CATL all experienced per-kWh price compression — but it means Tesla needs to sustain volume growth and cost reduction simultaneously to keep margins expanding.

The automotive-to-energy revenue shift could accelerate. Energy was 10 % of Tesla’s revenue in FY2024, up from 6 % in FY2023. If automotive growth remains subdued while energy storage deployments continue doubling, the energy segment could become a significantly larger share of the business within a few years. Whether Wall Street values this positively depends on how margins compare across segments.

Backlog visibility matters. The $7.18 billion in unsatisfied performance obligations (of which $4.51 billion is expected within 12 months) suggests strong demand, but Tesla does not disclose a formal order backlog for Megapack. Investors and competitors alike will watch whether this figure grows, stabilizes, or contracts in coming filings as an indicator of forward demand.

Other annual report analyses in this series:

10. Sources

All data in this article is sourced from Tesla’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the US Securities and Exchange Commission.

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