Tesla’s Fastest-Growing Business Isn’t Cars Anymore—Or Even Robots
Tesla’s profit plunged sharply last year due to falling electric vehicle sales and a costly bet on artificial intelligence and robotics. But there was one bright spot among all of that: energy storage.
In its fourth-quarter and full-year 2025 earnings report released Wednesday, the automaker said it posted its highest-ever quarterly stationary energy storage (ESS) deployments, driven by surging demand for its Megapack batteries. The Q4 energy storage deployment reached 14.1 gigawatt-hours, up from 11.0 GWh during the same period last year.
The thing is, Tesla’s business spans beyond cars, AI and robotics. Its fast-growing energy business includes solar, residential Powerwall batteries and industrial-scale Megapack systems. And as power-hungry AI data centers strain electricity grids worldwide, Megapacks are becoming increasingly important.
Photo by: Tesla
The massive, shipping-container-sized Megapack batteries are designed to store excess energy during off-peak hours and discharge it when demand spikes during peak hours. They are also playing a growing role in smoothing out the intermittency of renewable power, something utlities nationwide are increasingly relying on.
Tesla said record Megapack deployments generated $1.1 billion in gross profit for its energy generation and storage business in the fourth quarter, marking a fifth consecutive record-setting quarter. The company also said more than one million installed Powerwall units are helping homeowners save roughly $1 billion annually on electricity costs.
And Tesla’s charging business is also increasingly tied into this energy ecosystem. Some of its newest Superchargers are backed by solar farms and Megapack batteries, including the massive Lost Hills, California site. It’s the largest Supercharger station in the world, and it’s entirely off-grid.
While Tesla’s passenger vehicle business grapples with slowing sales and a stale line-up, and we don’t really know if its bet on AI and robotics will reap dividends, one thing is clear: its energy arm is well-positioned at the center of the AI power boom. Expect to see more growth in the coming years.
Contact the author: suvrat.kothari@insideevs.com
