Big blow to Elon Musk as Tesla profits crash 71 per cent; Investors seek Donald Trump's adviser's resignation

Tesla reported a 71 per cent drop in first-quarter profits Tuesday in results that lagged analyst estimates as Elon Musk's automaker warned of a hit to demand due to "changing political sentiment", as per a report

The electric vehicle producer reported profits of $409 million, down 71 per cent from the year-ago results. The company retreated from its 2025 guidance, citing uncertainty about trade policy and demand, AFP reported.

The Austin, Texas, company said Tuesday that quarterly profits fell by 12 cents a share. That’s far below analyst estimates. Tesla’s revenue fell 9 per cent to $19.3 billion in the January through March period, below Wall Street’s forecast.


Tesla's stock has fallen more than 40 per cent this year.

Many investors have also complained Musk is too distracted with his Trump administration role to be running Tesla and that he should either relinquish his position as CEO or abandon his advisory role in Washington.

Meanwhile, treasurers of seven U.S. states have raised concerns about Tesla CEO Elon Musk's lack of focus on the electric vehicle maker, given its significance in regional industries, innovation and employment.

Tesla deliveries plunged 13 per cent in the first quarter due to backlash against Elon Musk's politics, rising global competition and people waiting for a refresh to its highest-selling electric vehicle Model Y.

If Tesla falters, the effects will not be confined to shareholders, but will be felt across regional economies, workforce pipelines and public confidence in the energy transition, California State Controller Malia Cohen and seven state treasurers, including Washington's Mike Pellicciotti and Illinois' Michael Frerichs, said.

The treasurers asked the board to clarify how Musk and the Tesla board were ensuring that adequate time and effort was being put into resolving the company's underperformance, and how the board was evaluating whether executive compensation was aligned with shareholder value and corporate accountability.

FAQs

Q1. Who is CEO of Tesla?
A1. CEO of Tesla is Elon Musk.

Q2. What do we know about Tesla stock performance?
A2. Tesla's stock has fallen more than 40 per cent this year.