(Spencer Platt/Getty Images)

Tesla’s regulatory credit revenue — and profit — will likely plummet next quarter

The NHTSA has stopped issuing letters to automakers for violating fuel economy standards, gutting the market for regulatory credits.

Rani Molla

8/18/25 12:41PM

Now that the National Highway Traffic Safety Administration is no longer issuing compliance letters to automakers for violating fuel economy standards, there’s effectively no US regulatory credit market. Regulatory credit revenue is a massive profit accelerant for electric vehicle makers, bolstering Tesla’s, Lucid’s, and Rivian’s bottom lines.

Rivian already took a $100 million revenue hit from the regulatory change, while Lucid said the credits “represent a significant share” of its revenue. Tesla, as the biggest EV maker, will face more revenue pain than its comparatively smaller rivals.

“While we’ve never planned our business around such sales, it will nonetheless impact our total revenues going forward,” Tesla CFO Vaibhav Taneja said on the company’s latest earnings call.

Analyst Troy Teslike estimates the US rollback will take a $255 million bite of Tesla’s revenue each quarter — more than $1 billion a year — going forward. In the second quarter, the company brought in $439 million in regulatory credit revenue globally. Given that it’s effectively a pure boost to profit margins, that revenue played an outsized role in generating Tesla’s $1.2 billion net income last quarter. Teslike estimates about 41% of Tesla’s regulatory credit revenue comes from the US, so expect these bars to be about half the size in the future:

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OpenAI’s ARR reached over $20 billion in 2025, CFO says

Sam Altman’s $500 billion artificial intelligence behemoth hit a major financial milestone last year, according to a new blog post over the weekend from OpenAI CFO Sarah Friar, as the company confirmed it had hit a more than $20 billion annual revenue run rate at the end of 2025.

Elsewhere in the blog post, Friar spent time addressing the company’s shifting goals, referencing plans to “close the distance between where intelligence is advancing and how individuals, companies, and countries actually adopt and use it.” As has become customary in the AI company press release genre, the CFO was also keen to tout the unending growth of the business, writing:

“Both our Weekly Active User (WAU) and Daily Active User (DAU) figures continue to produce all-time highs. This growth is driven by a flywheel across compute, frontier research, products, and monetization.”
“Compute grew 3X year over year or 9.5X from 2023 to 2025: 0.2 GW in 2023, 0.6 GW in 2024, and ~1.9 GW in 2025.”

And, perhaps most importantly for current backers and those keeping an eye on the private company before its rumored mega IPO:

“Revenue followed the same curve growing 3X year over year, or 10X from 2023 to 2025: $2B ARR in 2023, $6B in 2024, and $20B+ in 2025. This is never-before-seen growth at such scale.”

That latest figure has certainly set tongues in the tech world wagging, just as the company announced it would begin rolling out ads to free and ChatGPT Go users. It also puts the chatbot giant a fair way ahead of competitors like Anthropic, the company behind Claude.

OpenAI Anthropic ARR race — Sherwood News

A business that scales with the value of intelligence

“Both our Weekly Active User (WAU) and Daily Active User (DAU) figures continue to produce all-time highs. This growth is driven by a flywheel across compute, frontier research, products, and monetization.”
“Compute grew 3X year over year or 9.5X from 2023 to 2025: 0.2 GW in 2023, 0.6 GW in 2024, and ~1.9 GW in 2025.”