In This Article:
(Bloomberg) -- One of Wall Street’s most bearish Tesla Inc. analysts further reduced estimates for the company’s earnings, citing the magnitude of car-buyer backlash against Elon Musk.
Most Read from Bloomberg
-
Metro-North Is Faster Than Acela on NYC-New Haven Route After Signal Updates
-
London Clears Final Hurdle for More High-Speed Trains to Europe
Tesla’s first-quarter vehicle deliveries were far below even JPMorgan Chase & Co. analyst Ryan Brinkman’s pessimistic estimate, “confirming the unprecedented brand damage we had earlier feared,” he said in a report Friday.
The sales report “causes us to think that — if anything — we may have underestimated the degree of consumer reaction,” Brinkman wrote.
Tesla shares fell more than 4% at the start of regular trading. Since hitting a record high on Dec. 17, the stock slumped 44% through the close Thursday.
During the first three months of the year, Tesla delivered 336,681 vehicles, its worst quarterly total since 2022. In addition to changing over production lines at each of its assembly plants to build the redesigned Model Y, the automaker was contending with Musk, its chief executive officer, becoming a more polarizing figure due to his interventions in global politics.
JPMorgan now expects Tesla’s first-quarter earnings to slip to 36 cents a share, short of its previous projection of 40 cents and analysts’ average estimate of 46 cents.
Brinkman also trimmed his full-year projection to $2.30 a share. Analysts surveyed by Bloomberg are on average estimating the company will earn $2.70 per share — and Brinkman notes that this figure has dropped 17% since Tesla last reported quarterly earnings in late January.
Musk is expected to step back from his role leading the initiative known as the Department of Government Efficiency once his 130-day period as a temporary adviser to President Donald Trump has lapsed, Bloomberg reported Thursday.
But the billionaire will still wield significant influence over the federal cost-cutting effort and remain a Trump confidant after his formal departure, according to people familiar with the matter.
The Tesla CEO is a special government employee, a classification for temporary federal hires who are only supposed to work 130 days out of the year in their roles. A formal date hasn’t been set for Musk to leave, and the White House counsel’s office is in charge of determining when Musk has worked his 130 days, the people said.