Tesla’s Terrible Earnings, the FTC’s Noncompete Ban, and 24/7 Trading at the NYSE | Prof G Markets
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Earnings Impact
and discuss Tesla's disappointing first quarter earnings, where revenue fell for the first time since 2020, and profits dropped over 50% year-over-year. Despite these setbacks, Tesla's stock rose by 14%, a surprising reaction attributed to 's focus on AI and autonomous technology rather than its core automotive business 1. Scott suggests that the market's response might be due to perceptions of the stock being oversold or Musk's reputation for leveraging new technologies 1.
The company is playing a serious game of jazz hands and they're like, let's talk about our energy revenues and the margins there. Let's talk about AI, let's talk about autonomous robotaxis. Let's do anything but talk about our core business.
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He also highlights the disparity in Tesla's valuation compared to other tech and auto companies, questioning the sustainability of its current market position 1.
Identity Shift
Tesla's attempt to rebrand itself as more than just an automotive company is met with skepticism by . He argues that despite 's claims of Tesla being an AI and robotics company, the core business remains automotive, which is struggling with declining deliveries and margins 2. Scott criticizes Musk's track record in AI, noting his departure from OpenAI as a significant misstep 2.
I think he's lost a ton of credibility. He said in 2017, I think within two years, there'd be a million autonomous Teslas on the road.
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The discussion also touches on the ambitious yet vague promises of a robotaxi fleet, which lacks concrete details and regulatory approval, further questioning Tesla's strategic direction 2.
