This Underrated Tesla Business Segment Is Growing Like Crazy
While Tesla's electric car sales are suffering, this business segment is seeing both surging demand and soaring sales.
There's been a lot of attention recently on Tesla's (NASDAQ: TSLA) core automotive business. The segment's declining revenue in 2024 has spooked investors and has ultimately been a key reason for the stock's big downturn this year. But not all of the electric-car maker's business segments are seeing underwhelming sales. In fact, there's one part of Tesla's business where the company is growing at triple-digit rates. Yes, you heard that right: triple digits. We're talking about the soaring sales of Tesla's energy storage products.
What exactly are Tesla's energy storage products? Powerful smart batteries that can help stabilize energy grids, prevent electric utility outages, act as back-up power for homes, and more. Tesla's two main energy storage products are Powerwall, a battery for homes, and Megapack, a large-scale commercial solution for utilities. The products may sound boring but their implications to Tesla's business are mighty.
In 2024, Tesla deployed 31.4 gigawatt hours (GWh) of energy storage capacity, up 114% year over year. Even more, growth in this business accelerated drastically by the end of the year. In Q4 specifically, Tesla deployed 11 GWh of energy storage, up 244% year over year. And here's the icing on the cake: Growth would have been even faster during the year, but Tesla said in its fourth-quarter shareholder update that its energy storage product deliveries were supply constrained. In other words, it couldn't make enough products to serve demand.
