Investor's Corner
Tesla to reopen Fremont factory for “limited operations” as CA lifts shutdown for lower risk industries
Tesla is expected to resume operations at its Fremont factory in Northern California as early as today, following an announcement by state Governor Gavin Newsom that “lower risk industries” will be able to resume work activities. Multiple emails sent by Tesla executives on Thursday evening, including CEO Elon Musk, outlined the company’s plans to reopen the production lines on Friday, May 8.
“In light of Governor Newsom’s statement earlier today approving manufacturing in California, we will aim to restart production in Fremont tomorrow afternoon. I will be on the line personally helping wherever I can,” Musk wrote in an email obtained by CNBC. “However, if you feel uncomfortable coming back to work at this time, please do not feel obligated to do so. These are difficult times, so thanks very much for working hard to make Tesla successful!”
In another company email from Tesla’s Head of Human Resources, Valerie Capers Workman, it seems Tesla plans to resume “limited operations” by allowing 30% of the regular employees on a shift to come in for work, according to CNBC.
Elon Musk threatens to move Tesla away from California amid ongoing lockdown dispute
Governor Newsom announced the lift on Thursday evening, stating that clothing stores, bookstores, florists, sporting goods stores, as well as manufacturing and logistics operations, could resume their routine work.
The news came to the approval of Musk, who has been a vocal proponent of lifting Stay-at-Home bans. Musk called for the orders to be raised during Tesla’s Q1 2020 Earnings Call on April 29 and has pushed for leniency on the prohibitions.
Musk also opened up in broader detail about his discontent for the Stay-at-Home orders on a recent episode of the Joe Rogan Experience podcast. The Tesla CEO cited he was still skeptical about the severity of the illness, and believed there needed to be more accurate data concerning the number of people infected.
While Musk has been critical of the panic that the virus has incited, he has done his part to help by donating ventilators to over 50 hospitals that are located in Tesla’s delivery areas.
It appears that Tesla’s Fremont facility may receive the hypothetical “ok” to reopen. After the company seemed to have a preliminary timeline to open Fremont on May 4, the plans were derailed after Alameda County health officers had decided that Stay-at-Home needed revisions.
Many expected the restrictions on free travel to end in June. However, it seems that Newsome and other political members have decided that it is safe to begin reopening some portions of the California workforce. The facilities that the State of California is choosing to open seem to be low risk as there is little face-to-face interaction other than brief transaction periods that would take place at retail locations.
Still, retailers must “increase pick up and delivery and encourage physical distancing during pickup and install hands-free devices.” Manufacturers are to close breakrooms and create outdoor break areas with seating designed to promote social distancing measures. Warehouses are encouraged to carry sanitation materials during deliveries and use protective equipment during every stop.
Tesla employs roughly 20,000 people in Northern California’s Bay Area. Half of the 20,000 work at the Fremont facility, and Elon Musk seems to be eager to get them back to work. With the company halting production lines since Fremont’s closing on March 23, there is plenty of work to be done, including the ramping up of the Model Y, the company’s newest vehicle.
There are a lot of Tesla bulls out there who have astronomical expectations for the company, especially as its arm of reach has gone well past automotive and energy and entered artificial intelligence and robotics.
However, some of the most bullish Tesla investors believe the company could become worth $100 trillion, and CEO Elon Musk does not believe that number is completely out of the question, even if it sounds almost ridiculous.
To put that number into perspective, the top ten most valuable companies in the world — NVIDIA, Apple, Alphabet, Microsoft, Amazon, TSMC, Meta, Saudi Aramco, Broadcom, and Tesla — are worth roughly $26 trillion.
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Cathie Wood of ARK Invest believes the number is reasonable considering Tesla’s long-reaching industry ambitions:
“…in the world of AI, what do you have to have to win? You have to have proprietary data, and think about all the proprietary data he has, different kinds of proprietary data. Tesla, the language of the road; Neuralink, multiomics data; nobody else has that data. X, nobody else has that data either. I could see $100 trillion. I think it’s going to happen because of convergence. I think Tesla is the leading candidate [for $100 trillion] for the reason I just said.”
Musk said late last year that all of his companies seem to be “heading toward convergence,” and it’s started to come to fruition. Tesla invested in xAI, as revealed in its Q4 Earnings Shareholder Deck, and SpaceX recently acquired xAI, marking the first step in the potential for a massive umbrella of companies under Musk’s watch.
SpaceX officially acquires xAI, merging rockets with AI expertise
Now that it is happening, it seems Musk is even more enthusiastic about a massive valuation that would swell to nearly four-times the value of the top ten most valuable companies in the world currently, as he said on X, the idea of a $100 trillion valuation is “not impossible.”
It’s not impossible
— Elon Musk (@elonmusk) February 6, 2026
Tesla is not just a car company. With its many projects, including the launch of Robotaxi, the progress of the Optimus robot, and its AI ambitions, it has the potential to continue gaining value at an accelerating rate.
Musk’s comments show his confidence in Tesla’s numerous projects, especially as some begin to mature and some head toward their initial stages.
Elon Musk
Tesla director pay lawsuit sees lawyer fees slashed by $100 million
The ruling leaves the case’s underlying settlement intact while significantly reducing what the plaintiffs’ attorneys will receive.
The Delaware Supreme Court has cut more than $100 million from a legal fee award tied to a shareholder lawsuit challenging compensation paid to Tesla directors between 2017 and 2020.
The ruling leaves the case’s underlying settlement intact while significantly reducing what the plaintiffs’ attorneys will receive.
Delaware Supreme Court trims legal fees
As noted in a Bloomberg Law report, the case targeted pay granted to Tesla directors, including CEO Elon Musk, Oracle founder Larry Ellison, Kimbal Musk, and Rupert Murdoch. The Delaware Chancery Court had awarded $176 million to the plaintiffs. Tesla’s board must also return stock options and forego years worth of pay.
As per Chief Justice Collins J. Seitz Jr. in an opinion for the Delaware Supreme Court’s full five-member panel, however, the decision of the Delaware Chancery Court to award $176 million to a pension fund’s law firm “erred by including in its financial benefit analysis the intrinsic value” of options being returned by Tesla’s board.
The justices then reduced the fee award from $176 million to $70.9 million. “As we measure it, $71 million reflects a reasonable fee for counsel’s efforts and does not result in a windfall,” Chief Justice Seitz wrote.
Other settlement terms still intact
The Supreme Court upheld the settlement itself, which requires Tesla’s board to return stock and options valued at up to $735 million and to forgo three years of additional compensation worth about $184 million.
Tesla argued during oral arguments that a fee award closer to $70 million would be appropriate. Interestingly enough, back in October, Justice Karen L. Valihura noted that the $176 award was $60 million more than the Delaware judiciary’s budget from the previous year. This was quite interesting as the case was “settled midstream.”
The lawsuit was brought by a pension fund on behalf of Tesla shareholders and focused exclusively on director pay during the 2017–2020 period. The case is separate from other high-profile compensation disputes involving Elon Musk.
Investor's Corner
Tesla (TSLA) Q4 and FY 2025 earnings call: The most important points
Executives, including CEO Elon Musk, discussed how the company is positioning itself for growth across vehicles, energy, AI, and robotics despite near-term pressures from tariffs, pricing, and macro conditions.
Tesla’s (NASDAQ:TSLA) Q4 and FY 2025 earnings call highlighted improving margins, record energy performance, expanding autonomy efforts, and a sharp acceleration in AI and robotics investments.
Executives, including CEO Elon Musk, discussed how the company is positioning itself for growth across vehicles, energy, AI, and robotics despite near-term pressures from tariffs, pricing, and macro conditions.
Key takeaways
Tesla reported sequential improvement in automotive gross margins excluding regulatory credits, rising from 15.4% to 17.9%, supported by favorable regional mix effects despite a 16% decline in deliveries. Total gross margin exceeded 20.1%, the highest level in more than two years, even with lower fixed-cost absorption and tariff impacts.
The energy business delivered standout results, with revenue reaching nearly $12.8 billion, up 26.6% year over year. Energy gross profit hit a new quarterly record, driven by strong global demand and high deployments of MegaPack and Powerwall across all regions, as noted in a report from The Motley Fool.
Tesla also stated that paid Full Self-Driving customers have climbed to nearly 1.1 million worldwide, with about 70% having purchased FSD outright. The company has now fully transitioned FSD to a subscription-based sales model, which should create a short-term margin headwind for automotive results.
Free cash flow totaled $1.4 billion for the quarter. Operating expenses rose by $500 million sequentially as well.
Production shifts, robotics, and AI investment
Musk further confirmed that Model S and Model X production is expected to wind down next quarter, and plans are underway to convert Fremont’s S/X line into an Optimus robot factory with a capacity of one million units.
Tesla’s Robotaxi fleet has surpassed 500 vehicles, operating across the Bay Area and Austin, with Musk noting a rapid monthly expansion pace. He also reiterated that CyberCab production is expected to begin in April, following a slow initial S-curve ramp before scaling beyond other vehicle programs.
Looking ahead, Tesla expects its capital expenditures to exceed $20 billion next year, thanks to the company’s operations across its six factories, the expansion of its fleet expansion, and the ramp of its AI compute. Additional investments in AI chips, compute infrastructure, and future in-house semiconductor manufacturing were discussed but are not included in the company’s current CapEx guidance.
More importantly, Tesla ended the year with a larger backlog than in recent years. This is supported by record deliveries in smaller international markets and stronger demand across APAC and EMEA. Energy backlog remains strong globally as well, though Tesla cautioned that margin pressure could emerge from competition, policy uncertainty, and tariffs.
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