Tesla investors breathed a sigh of relief after CEO Elon Musk said he would refocus his attention on the electric automaker. The company's investors welcomed CEO Elon Musk’s promise to shift his focus back to Tesla after months of political involvement, but persistent concerns over brand damage and a sharp profit decline signal a challenging road ahead. Tesla shares surged nearly 8% on Wednesday, April 23, poised to add over $50 billion to its $766 billion market valuation. The move comes after Tesla reported a 71% drop in first-quarter profits and a 9% revenue decline, underscoring the urgency of Musk’s renewed commitment.
Elon Musk's Happiest Sentence
Elon Musk said on a conference call with analysts Tuesday, April 22, that “now that the major work of establishing Department of Government Efficiency is done he will be allocating far more of my time to Tesla” starting in May." Musk added that he now expects to spend just “a day or two per week on government matters."
Analysts Happy, but Worried as well
Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management and a prominent investor, told Reuters, "His time is very valuable, and I think Tesla needs his attention." Another prominent Tesla Bull Wedbush Securities' Dan Ives termed this as a step in the right direction. “This is a big step in the right direction," he said. Ives, added, “Investors wanted to see him recommit to Tesla.”
Tesla quarterly results show pain, but there are bright spots
Tesla’s quarterly results painted a grim picture: profits fell from $1.39 billion to $409 million, or 12 cents per share, missing analyst expectations, while revenue dropped from $21.3 billion to $19.3 billion. Gross margins slipped from 17.4% to 16.3%, squeezed by fierce competition from Chinese EV maker BYD and European rivals offering advanced models. Tesla’s energy storage business, reliant on Chinese battery cells, faces headwinds from looming Trump administration tariffs, which Musk has lobbied against but warned could cause “unexpected bumps.” Retaliatory trade restrictions from China have already forced Tesla to halt orders for its Model S and Model X in the mainland market.
Despite the gloom, Tesla reaffirmed plans to launch an affordable Model Y variant in early 2025, though it cautioned that production could ramp up slowly. The company also doubled down on its autonomous driving ambitions, with Musk claiming “millions of Teslas” will operate autonomously by late 2025, including a paid robotaxi service launching in Austin in June.
Bright spots included $595 million in regulatory credit sales, up from $442 million a year ago, and strong cash flow of $2.2 billion, compared to $242 million in the prior year. “It was good to see positive cash flow,” said Morningstar analyst Seth Goldstein, though he noted the results were unsurprising given earlier reports of slumping deliveries. Tesla plans to review its full-year delivery forecast in its July earnings update, citing shifting global trade policies and “changing political sentiment” as near-term risks to demand. Finance chief Vaibhav Taneja highlighted the “negative impact of vandalism and unwarranted hostility” on certain markets, underscoring the tangible toll of Tesla’s tarnished image.
Elon Musk's Happiest Sentence
Elon Musk said on a conference call with analysts Tuesday, April 22, that “now that the major work of establishing Department of Government Efficiency is done he will be allocating far more of my time to Tesla” starting in May." Musk added that he now expects to spend just “a day or two per week on government matters."
Analysts Happy, but Worried as well
Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management and a prominent investor, told Reuters, "His time is very valuable, and I think Tesla needs his attention." Another prominent Tesla Bull Wedbush Securities' Dan Ives termed this as a step in the right direction. “This is a big step in the right direction," he said. Ives, added, “Investors wanted to see him recommit to Tesla.”
Tesla quarterly results show pain, but there are bright spots
Tesla’s quarterly results painted a grim picture: profits fell from $1.39 billion to $409 million, or 12 cents per share, missing analyst expectations, while revenue dropped from $21.3 billion to $19.3 billion. Gross margins slipped from 17.4% to 16.3%, squeezed by fierce competition from Chinese EV maker BYD and European rivals offering advanced models. Tesla’s energy storage business, reliant on Chinese battery cells, faces headwinds from looming Trump administration tariffs, which Musk has lobbied against but warned could cause “unexpected bumps.” Retaliatory trade restrictions from China have already forced Tesla to halt orders for its Model S and Model X in the mainland market.
Despite the gloom, Tesla reaffirmed plans to launch an affordable Model Y variant in early 2025, though it cautioned that production could ramp up slowly. The company also doubled down on its autonomous driving ambitions, with Musk claiming “millions of Teslas” will operate autonomously by late 2025, including a paid robotaxi service launching in Austin in June.
Bright spots included $595 million in regulatory credit sales, up from $442 million a year ago, and strong cash flow of $2.2 billion, compared to $242 million in the prior year. “It was good to see positive cash flow,” said Morningstar analyst Seth Goldstein, though he noted the results were unsurprising given earlier reports of slumping deliveries. Tesla plans to review its full-year delivery forecast in its July earnings update, citing shifting global trade policies and “changing political sentiment” as near-term risks to demand. Finance chief Vaibhav Taneja highlighted the “negative impact of vandalism and unwarranted hostility” on certain markets, underscoring the tangible toll of Tesla’s tarnished image.
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