Today's Edition
WASHINGTON (dpa)
Shares in Tesla were gaining ground on Wednesday in pre-market trading after chief executive Elon Musk said he would cut the time he spends on political projects and devote more time to the leading electric vehicle manufacturer.
Shares were gaining around 7% in the pre-market hours on the Nasdaq, continuing the upbeat after-hours activity on Tuesday, after Musk announced that he will reduce time with President Donald Trump's Department of Government Efficiency (DOGE) significantly, starting in May.
The announcement on the luxury electric vehicle maker's earnings call came after it reported disappointing first-quarter profit and revenues with weak volume.
On the Nasdaq, Tesla stock moved 5.4% higher in the extended trading on Tuesday after closing the regular trade 4.6% higher. The stock is currently gaining 7.2% in pre-market activity, at $255.00. Tesla's stock price had plunged more than 40% this year.
On the earnings call, Musk, a supporter of Trump and a prominent public face of the DOGE initiative, stated that with the major work of establishing DOGE done, he plans to allocate probably more time to Tesla, starting next month.
He added that he will continue to be associated with the DOGE team probably for the remainder of Trump's term to make sure that the waste and fraud the team is eradicating does not return.
Musk plans to continue to spend a day or two per week on government matters for as long as the president asks and as long as it is useful, he said.
Musk had spent almost $300 million in the 2024 campaign to help Trump return to the White House. He was appointed as special government employee, who then created DOGE with a view to cut down the size and unwanted expenses of the federal government.
DOGE's website currently shows that the cuts have resulted in an
estimated $160 billion in savings.
Meanwhile, Musk's ties to Trump had affected Tesla significantly with severe protests and brand damage. Its stock also fell sharply since Trump took office.
However, Musk in the earnings call called those protests very organised, claiming that some people are likely protesting because they're receiving fraudulent money or are recipients of wasteful largesse.
In its first quarter, Tesla's profit decreased 71% from last year and missed the Street estimates. The company's earnings came in at $409 million or $0.12 per share, sharply lower than last year's $1.390 billion or $0.41 per share.
Adjusted earnings were $934 million or $0.27 per share for the period. Analysts on average had expected the company to earn $0.42 per share. Analysts' estimates typically exclude special items.
The company's revenue for the period fell 9.2% to $19.335 billion from $21.301 billion last year with a decline in vehicle deliveries. Total automotive revenues declined 20% from last year to $13.97 billion.
In the quarter, total production dropped 16% to 362,615 units, and total deliveries fell 13% to 336,681 units.
