With Tesla Earnings, Don’t Forget About Bitcoin

Tesla’s investment in Bitcoin soared in value in the second quarter, after a first-quarter drop. (PATRICK T. FALLON/AFP via Getty Images)

Tesla reports second-quarter earnings on Wednesday amid falling sales and dwindling government support. One thing that will help offset all that is Bitcoin.

For the quarter, Wall Street expects earnings per share of about 39 cents on sales of $22.1 billion, according to FactSet. A year ago, Tesla reported earnings per share of 52 cents on sales of $25.5 billion. Sales and earnings are set to sink along with vehicle sales. Tesla sold about 384,000 cars in the second quarter of 2025, down 13.5% year over year.

Despite falling numbers, investors would still like to see Tesla meet or beat expectations. “We see results coming in largely in line due to Bitcoin gain,” wrote GLJ Research analyst Gordon Johnson.

Tesla holds about 11,500 bitcoin. In the first quarter, Tesla reported a $125 million loss related to its digital asset holdings after Bitcoin started 2025 at about $92,000 and ended the first quarter at about $82,000. Bitcoin, however, closed out the second quarter at about $109,000, and Tesla’s quarterly gain should be roughly $300 million.

That’s significant. Wall Street projects an operating profit of $1.1 billion.

The gain might not impact the operating profit figure, though. In the first quarter, Tesla excluded Bitcoin swings from its non-GAAP results. GAAP is short for generally accepted accounting principles. Many, if not most, companies report both GAAP and adjusted numbers.

That means the first-quarter Bitcoin losses weren’t included in the adjusted results most analysts cite.

Still, Tesla’s Bitcoin holdings have become more valuable. How investors choose to give Tesla credit for its bitcoin holdings is anyone’s guess. Cryptocurrency movements amount to a relatively small change in the value of Tesla’s cash-like holdings. They don’t have anything to do with selling cars or developing artificial-intelligence-trained taxis and robots.

Johnson is a Tesla bear rating shares Sell. He also expects Tesla to recognize more deferred revenue related to self-driving technologies. Tesla defers some revenue, like software companies, to account for upgrades to its products expected by customers. Deferred revenue recognition has been running at about $250 million per quarter. Johnson sees that rising to about $350 million in the second quarter.

Tesla stock rose 1.1% on Tuesday, ahead of earnings, while the S&P 500 and Dow Jones Industrial Average rose 0.1% and 0.4%, respectively. Coming into Tuesday trading, Tesla stock was down about 19% year to date, but up about 31% over the past 12 months.

Write to Al Root at allen.root@dowjones.com