

Energy
Tesla’s expansion of product offerings shows that a major expansion is in the making
Over the recent weeks, Tesla appears to be setting the stage for an intensive expansion of its product offerings. From the United States to China, the company seems to be intent on pursuing more and more avenues for its electric car and energy business. This hints at one thing: a major expansion is underway, and the all-too challenging battery supply code has been cracked.
Tesla CEO Elon Musk is known for his grand and ambitious dreams. If it were up to Musk, the world would completely abandon fossil fuels and dedicate a part of its resources to exploring interplanetary solutions. But Tesla, one of Musk’s two main businesses, is heavily reliant on batteries. No matter how much Tesla or Musk would want to accelerate the ramp towards sustainability, the proverbial battery supply problem has to be solved first.
This was highlighted by Musk in a previous earnings call last year. When asked about the Tesla Semi, a Class 8 truck that was initially set to begin deliveries in 2019 but was subsequently delayed, Musk explained that the vehicle could not be ramped fully unless the issue of battery cell supply is addressed. After all, the Semi is a massive vehicle, and it uses a lot of cells.
This sentiment is pretty much universal across Tesla’s lineup, including its Energy business and in products like the humble Powerwall and the grid-scale Megapack. Longtime followers of Tesla would remember that during the height of the Model 3’s production hell, Tesla ended up using lines that were allotted for the Powerwall’s cells to produce batteries for the electric sedan instead. This resulted in delays for the home battery storage unit.
But things today are much different than before. Amidst the impending announcements for Battery Day, reports are abounding that the company is poised to reveal the latest innovations in its battery tech. Among these is a million-mile battery, which would be resilient enough to outlast the internal combustion engine when used in electric cars and durable enough to last decades if deployed as battery storage.
These breakthroughs could change everything for Tesla, and it would allow the company to expand at a rate that exceeds its already rapid growth over the years. Tesla has been providing hints about the stages of this growth, from the rollout of China-made Model 3s that are equipped with batteries that have no cobalt content, the highly-anticipated production ramp of the Semi, the aggressive timeframe for the Cybertruck, renewed battery cell deals with Panasonic, to its recent permit to become a utility provider in the United Kingdom.

Each of these projects would not be possible unless the company has cracked the code on battery cell technology and production. Today, all signs are pointing to this very scenario. This should ultimately be validating for the company and its executives, considering that it has attracted a notable amount of criticism and mockery over the years due to its intense focus and pursuit of next-generation battery tech.
Back in 2014, after all, even the MIT Technology Review noted that there is little sense in an endeavor like Gigafactory Nevada, since Tesla’s car sales then did not warrant such a demand for batteries. Critics then also argued that it would be better for Tesla to just work with existing battery manufacturers. Interestingly, ARK Invest, one of Tesla’s most ardent bulls, was one of the few that actually believed in the value of Gigafactory Nevada in 2014, stating that it while ambitious, the company’s plans for the facility are actually feasible.
Energy
Tesla Megapacks powers the xAI Colossus supercomputer
Tesla Megapacks step in to stabilize xAI’s Colossus supercomputer, replacing natural gas turbines. Musk’s ventures keep intertwining.

Tesla Megapack batteries will power the xAI Colossus supercomputer in Memphis to ensure power stability. The collaboration between Tesla and xAI highlights the synergy among Elon Musk’s ventures.
The artificial intelligence startup has integrated Tesla Megapacks to manage outages and demand surges, bolstering the facility’s reliability. The Greater Memphis Chamber announced that Colossus, recently connected to a new 150-megawatt electric substation, is completing its first construction phase. This transition addresses criticism from environmental justice groups over the initial use of natural gas turbines.
“The temporary natural gas turbines that were being used to power the Phase I GPUs prior to grid connection are now being demobilized and will be removed from the site over the next two months.
“About half of the operating turbines will remain operating to power Phase II GPUs of xAI until a second substation (#22) already in construction is completed and connected to the electric grid, which is planned for the Fall of 2025, at which time the remaining turbines will be relegated to a backup power role,” the Chamber stated.
xAI’s rapid development of Colossus reflects its ambition to advance AI capabilities, but the project has faced scrutiny for environmental impacts. The shift to Megapacks and grid power aims to mitigate these concerns while ensuring operational continuity.
The Megapack deployment underscores the collaboration among Musk’s companies, including Tesla, SpaceX, Neuralink, and The Boring Company. Tesla appears to be the common link between all of Musk’s companies. For example, The Boring Company built a tunnel in Giga, Texas. In addition, Musk has hinted at a potential collaboration between the Tesla Optimus Bot and Neuralink. And from January 2024 to February 2025, xAI invested $230 million in Megapacks, per a Tesla filing.
Tesla Energy reported a 156% year-over-year increase in Q1 2025, deploying 10.4 GWh of storage products, including Megapacks and Powerwalls. Tesla’s plans for a new Megapack factory in Waller County, Texas, which is expected to create 1,500 jobs in the area, further signal its commitment to scaling energy solutions.
As xAI leverages Tesla’s Megapacks to power Colossus, the integration showcases Musk’s interconnected business ecosystem. The supercomputer’s enhanced stability positions xAI to drive AI innovation, while Tesla’s energy solutions gain prominence, setting the stage for broader technological and economic impacts.
Energy
Tesla Energy celebrates one decade of sustainability
Tesla Energy has gone far since its early days, and it is now becoming a progressively bigger part of the company.

Tesla Energy recently celebrated its 10th anniversary with a dedicated video showcasing several of its milestones over the past decade.
Tesla Energy has gone far since its early days, and it is now becoming a progressively bigger part of the company.
Tesla Energy Early Days
When Elon Musk launched Tesla Energy in 2015, he noted that the business is a fundamental transformation of how the world works. To start, Tesla Energy offered the Powerwall, a 7 kWh/10 kWh home battery system, and the Powerpack, a grid-capable 100 kWh battery block that is designed for scalability. A few days after the products’ launch, Musk noted that Tesla had received 38,000 reservations for the Powerwall and 2,500 reservations for the Powerpack.
Tesla Energy’s beginnings would herald its quiet growth, with the company later announcing products like the Solar Roof tile, which is yet to be ramped, and the successor to the Powerwall, the 13.5 kWh Powerwall 2. In recent years, Tesla Energy also launched its Powerwall 3 home battery and the massive Megapack, a 3.9 MWh monster of a battery unit that has become the backbone for energy storage systems across the globe.
Key Milestones
As noted by Tesla Energy in its recent video, it has now established facilities that allow the company to manufacture 20,000 units of the Megapack every year, which should help grow the 23 GWh worth of Megapacks that have already been deployed globally.
The Powerwall remains a desirable home battery as well, with more than 850,000 units installed worldwide. These translate to 12 GWh of residential entry storage delivered to date. Just like the Megapack, Tesla is also ramping its production of the Powerwall, allowing the division to grow even more.
Tesla Energy’s Role
While Tesla Energy does not catch as much headlines as the company’s electric vehicle businesses, its contributions to the company’s bottom line have been growing. In the first quarter of 2025 alone, Tesla Energy deployed 10.4 GWh of energy storage products. Powerwall deployments also crossed 1 GWh in one quarter for the first time. As per Tesla in its Q1 2025 Update Letter, the gross margin for the Energy division has improved sequentially as well.
Elon Musk
Tesla Energy shines with substantial YoY growth in deployments

Tesla Energy shined in what was a weak delivery report for the first quarter, as the company’s frequently-forgotten battery storage products performed extraordinarily well.
Tesla reported its Q1 production, delivery, and deployment figures for the first quarter of the year, and while many were less-than-excited about the automotive side, the Energy division performed well with 10.4 GWh of energy storage products deployed during the first quarter.
This was a 156 percent increase year-over-year and the company’s second-best quarter in terms of energy deployments to date. Only Q4 2024 was better, as 11 GWh was recorded.
Tesla Energy is frequently forgotten and not talked about enough. The company has continued to deploy massive energy storage projects across the globe, and as it recorded 31.5 GWh of deployments last year, 2025 is already looking as if it will be a record-setting year if it continues at this pace.
Tesla Megapacks to back one of Europe’s largest energy storage sites
Although Energy performed well, many investors are privy to that of the automotive division’s performance, which is where some concern lies. Tesla had a weak quarter for deliveries, missing Wall Street estimates by a considerable margin.
There are two very likely reasons as to why this happened: the first is Tesla’s switchover to the new Model Y at its production facilities across the globe. Tesla said it lost “several weeks” of production due to the updating of manufacturing lines as it rolled out a new version of its all-electric crossover.
Secondly, Tesla could be facing some pressure from pushback against the brand, which is what many analysts will say. Despite the publicity of attacks on Tesla drivers and their vehicles, as well as the company’s showrooms, it would be safe to assume that we will have a better picture painted of what the issue is in Q2 after the company reports numbers in July.
If Tesla is still struggling with lackluster delivery figures in Q2 after the Model Y is ramped and deliveries are more predictable and consistent, we could see where the argument for brand damage is legitimate. However, we are more prone to believe the Model Y, which accounts for most of Tesla’s sales, and its production ramp is likely the cause for what happened in Q1.
In what was a relatively bleak quarter, Tesla Energy still shines as the bright spot for the quarter.
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