Revised estimates of kinetic energy production by tropical cyclones in the Atlantic and western North Pacific are presented. These show considerable variability on interannual-to-multidecadal time scales. In the Atlantic, variability on time scales of a few years and more is strongly correlated with tropical Atlantic sea surface temperature, while in the western North Pacific, this correlation, while still present, is considerably weaker. Using a combination of basic theory and empirical statistical analysis, it is shown that much of the variability in both ocean basins can be explained by variations in potential intensity, low-level vorticity, and vertical wind shear. Potential intensity variations are in turn factored into components related to variations in net surface radiation, thermodynamic efficiency, and average surface wind speed. In the Atlantic, potential intensity, low-level vorticity, and vertical wind shear strongly covary and are also highly correlated with sea surface temperature, at least during the period in which reanalysis products are considered reliable. In the Pacific, the three factors are not strongly correlated. The relative contributions of the three factors are quantified, and implications for future trends and variability of tropical cyclone activity are discussed.