Tesla CEO Elon Musk said he’d be reducing his time with the Department of Government Efficiency beginning next month after the company reported disappointing earnings, missing Wall Street expectations.
In an earnings call, Musk said the ongoing blowback, consisting of nationwide protests and violent vehicle attacks, left him with two options: Let the government’s waste and fraud continue or fight it.
“I believe the right thing to do is to fight the waste and fraud and get the country back on the right track,” Musk said, announcing he’d be reducing his time with the agency in May, though he’s determined to stay on for a day or two a week until the remainder of Trump’s term.
“Starting next month, I’ll be allocating far more of my time to Tesla,” he said.
On Tuesday, the company reported its lowest revenue since Q3 2021, with a double miss EPS of $0.27 vs an estimated $0.39 and revenue of $19.34bn vs $21.11bn estimate.
Net income fell 71 percent in the first quarter. The stock is down approximately 40 percent year-to-date but rose four percent in the after-hours market.
Tesla had been plagued with a series of bad headlines ahead of earnings, with reports of declining sales, customers looking to ditch their cars and the price of used vehicles plummeting.
About half of Americans view Musk and the company negatively following his slashing of federal bureaucracy while running DOGE, a new CNBC poll found. Violent attacks against the company have become so heightened that the Justice Department recently announced a Tesla investigative task force.
Hours before the call, climate activists spray-painted a Tesla showroom in Manhattan with the words “F*** DOGE.”
As Musk spoke, he appeared to imply demonstrations against the brand were “paid for” and supported by those benefitting from “wasteful largesse.”
But that’s not where the company’s troubles end.
Shortly after President Donald Trump announced tariffs on China, the country imposed a retaliatory 125 percent tariff, forcing Tesla to stop taking new orders for its Model S and Model X from Chinese customers.
Musk, who was initially considered one of the biggest winners of Trump’s tariffs, said he will continue to advise the president on financial policy but emphasized Trump’s decisions are his alone.
Though the majority of a Tesla car is US-made, the company relies on parts from China and Mexico that are subject to tariffs, potentially hurting its bottom line.
Long-term investors are hoping the company pulls through on its artificial intelligence and robotic ambitions. Tesla is debuting its first robotaxi pilot in June in Austin, Texas.
“Future of the company is fundamentally based on large-scale autonomous cars and…vast numbers of autonomous humanoid robots,” Musk said Tuesday.
However, Tesla’s auto sector accounts for most of the company’s overall revenue, and sales slumped 13 percent during the first three months of the year. Last week, Reuters reported Tesla delayed its US launch of an affordable electric vehicle, which was supposed to debut in the first half of the year.
“I continue to believe that Tesla, with excellent execution, will be the most valuable company in the world by far,” Musk continued, encouraging investors to look beyond the “bumps and potholes of the road immediately ahead of us” and toward a “bright, shining citadel on a hill.”
