Tesla Slides After Q1 Miss as Musk Vows to Cut DOGE Time
Tesla (TSLA, Financials) reported weak Q1 results Tuesday, with auto sales down 20% year over year and net income dropping 71%, as CEO Elon Musk said he plans to scale back his role in the Trump administration's government reform program, DOGE, starting in May.
Warning! GuruFocus has detected 4 Warning Sign with MS.
Revenue fell short of Wall Street expectations, and Tesla shares have now plunged over 40% year to date, according to CNBC. Musk, who created DOGE after backing Donald Trump's 2024 re-election bid with nearly $300 million, said during the earnings call he would reduce his time on federal restructuring from full-time to just a couple of days a week, though he plans to remain involved as long as needed.
The company cited external challenges including heightened competition from Chinese EV makers, protests in the U.S. and Europe, and brand headwinds tied to Musk's political affiliations. Protestors have targeted Tesla for its perceived alignment with far-right politics, including Musk's support of Germany's AfD party. Musk claimed without evidence that many protesters were recipients of wasteful largesse.
Tesla's auto division generated less revenue than the same quarter last year, while the company's overall market cap has shrunk by around $600 billion since DOGE's inception. Meanwhile, DOGE claims to have cut $160 billion in federal spendingfigures that have been disputed and partially retracted.
The administration confirmed that Musk holds a special government employee designation, allowing reduced disclosure obligations. DOGE-led cuts have reportedly affected agencies that regulate Musk's companies, including the Securities and Exchange Commission and the Federal Aviation Administration.
Investors will be watching for Tesla's next earnings and further clarification on Musk's future time allocation as he navigates federal duties and a shrinking EV market share.
See Tesla's insider trades: https://www.gurufocus.com/stock/TSLA/insider
This article first appeared on GuruFocus.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Digital Trends
an hour ago
- Digital Trends
Watch Tesla's self-driving Model Y perform a world first
In what is being described as a world first, a new car has just driven itself from the factory to the customer's home all by itself, with no one inside the vehicle. The feat was performed by a Tesla Model Y on Friday, with the electric-car maker posting a video (top) of the car's journey, which used Tesla's driver-assist Full Self-Driving (FSD) system to reach its destination. And this wasn't just a simple journey from Tesla's Texas Gigafactory in Austin to a residential address five minutes away. The trip took 30 minutes and really put the FSD system through its paces. 'This Tesla drove itself from Gigafactory Texas to its new owner's home 30 minutes away — crossing parking lots, highways, and the city to reach its new owner,' Tesla said in a comment accompanying the video, adding that the journey marked 'the first autonomous vehicle delivery of its kind in the world.' Tesla CEO Elon Musk was clearly delighted by the achievement, posting on X that the autonomous delivery had been completed a day ahead of schedule. Musk added: 'There were no people in the car at all and no remote operators in control at any point. FULLY autonomous! To the best of our knowledge, this is the first fully autonomous drive with no people in the car or remotely operating the car on a public highway.' However, as noted by some of those responding to his post, Alphabet-owned Waymo has been operating fully driverless vehicles on public highways for more than a year, so Musk is wrong on this point. Autonomous self-delivery like this has the potential to streamline the car delivery process, reduce costs, and eliminate trips, whether it's the customer heading to the dealership to pick up their new car, or staff heading back to base after dropping it off. It's a given that Tesla would like to deliver more of its new cars in this way, but it's not clear what its immediate plans are for such a system. The first-ever autonomous vehicle delivery can be marked down as a win for Tesla, and offers it some positive coverage in the wake of some less than celebratory headlines regarding its recently launched robotaxi service in Austin, Texas, a week ago. Shortly after its 10 Model Y robotaxis hit the road, reports emerged of some of the vehicles appearing to violate road rules as they carried passengers from A to B. The cars are being monitored remotely by Tesla staff and also have a human safety monitor in the front passenger seat who can intervene at any time.
Los Angeles Times
2 hours ago
- Los Angeles Times
The last Hong Kong pro-democracy party that held street protests disbands
HONG KONG — Hong Kong pro-democracy political party the League of Social Democrats announced Sunday that it had disbanded due to immense political pressure, the latest casualty in a years-long crackdown that has quieted the city's once-potent opposition. After massive anti-government protests in 2019, many leading activists were prosecuted and often jailed under a 2020 national security law imposed by Beijing. Dozens of civil society groups dissolved. Media outlets critical of the government closed. The League of Social Democrats was the only pro-democracy party that still staged small street protests from time to time, and it held street booth activities to carry on its advocacy despite the risks. Its chairperson, Chan Po-ying, said the disbandment decision was made after careful deliberation, especially taking into account the consequences to its members and allies. Chan refused to elaborate on the pressure but said she was proud to say that the party had contributed to the city's pro-democracy movement in these few years. 'We have stayed true to our original aspirations and haven't let down ... the trust placed in us by those who went to prison,' she said. 'While we are now forced to disband and feel an ache in our conscience, we have no other choice.' Hong Kong, a former British colony, will mark the 28th anniversary of its return to Chinese rule on Tuesday. The city used to hold annual pro-democracy protests that day and other demonstrations demanding policy changes. But those ceased after most organizing groups were disbanded and the leading activists were jailed. Critics say the drastic political changes under the security law reflect that the freedoms Beijing promised to keep intact in 1997 are shrinking. The Beijing and Hong Kong governments insist the law is necessary for the city's stability. A Chinese official overseeing Hong Kong affairs in 2023 said protests are not the only way for people to express their views, signaling Beijing's stance toward demonstrations in the city. In April, Hong Kong's biggest pro-democracy party, the Democratic Party, also voted to give its leadership the mandate to move toward a potential disbandment. Party veterans told the Associated Press that some members were warned of consequences if the party didn't shut down. A final vote is expected at a later date. Chan said she believed the 'one country, two systems' principle, which Beijing uses to govern Hong Kong, has already ended, pointing to the Chinese government's imposition of the security law and introduction of the concept of 'soft resistance,' a term officials use to refer to underlying security risks. 'One country, two systems has already [become] one country, one system,' she said. Founded in 2006, the League of Social Democrats was a left-wing political party that opposed what it called collusion between government and business, upheld the principle that people have a say and was firmly committed to the interests of underprivileged residents. It was widely known for its more aggressive tactics when fighting for change. Its members have thrown bananas, eggs and lunch meat at officials or pro-Beijing lawmakers as a protest gesture. Its party platform said the group advocated nonviolent resistance but would not avoid physical confrontations — a stance that set it apart from older, traditional pro-democracy groups. It once had three lawmakers in office. Its longest-serving lawmaker, Leung Kwok-hung — Chan's husband — was disqualified from the legislature due to his manner of taking his oath in office in 2017. On the streets, the group's activism led to the arrests and jailing of its members. Last year, Leung and prominent LGBTQ+ activist Jimmy Sham, a former party leader, were sentenced to nearly seven years and more than four years, respectively, over their roles in an unofficial primary election under the sweeping security law. Sham was freed from prison last month. In recent years, the party has had limited political influence, no longer holding any seats in the legislature or local district councils. Even a bank ceased to provide account services to the group. But it continued to stage occasional small protests, despite those activities sometimes leading to arrests. On June 12, Chan and other members were fined after being found guilty over their street booth activities. Undeterred by their convictions, they kept pressing on and protested against the ruling outside the court. Chan wiped away tears during Sunday's news conference and chanted slogans with other members at the end. She said she doesn't believe that democracy will come in the near future. 'Moving forward is not at all easy,' she said. 'I hope everyone can become like an ember, a flying spark — still carrying light, keeping that light alive, no matter how small it may be.' Leung writes for the Associated Press.
Business Insider
2 hours ago
- Business Insider
Trump says he has a group of ‘wealthy people' to buy TikTok, Reuters reports
U.S. President Donald Trump told Fox News (FOX) in an interview broadcast that he has found a buyer for the TikTok app, which he described as a group of 'very wealthy people' who will be revealed in about two weeks, Reuters reports. Trump said the deal being developed would likely need China's approval to move forward and predicted Chinese President Xi Jinping would likely approve it. Publicly traded companies in the space include Meta Platforms (META), Pinterest (PINS), Reddit (RDDT) and Snap (SNAP). Don't Miss TipRanks' Half Year Sale Take advantage of TipRanks Premium for 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
