Investor's Corner
Tesla will raise nearly $1.4B after higher than expected investor demand

Expanding Capital Raise to Meet Demand
Tesla has upped it’s capital raise from $1.15B to $1.38B after investors indicated higher demand for the offering. The company initially planned to offer 968,993 common shares and increased that to 1,335,878 shares of stock, raising an additional $350M. In addition to an increase in the common stock offering, Tesla also raised $850M from a convertible debt sale with an additional $127.5M available to the underwriters. The company initially intended to offer $750M in debt and raised that by $100M to meet demand. We will know within 30 days whether the underwriters decide to exercise their options to purchase, which would net Tesla an additional ~$180M. If the underwriters exercise their options, then the total proceeds of the sale will net $1.38B. This capital raise is intended to “de-risk” the company’s financial condition as they focus on getting the Model 3 into production this year.
Tesla’s bond offering of $850M consisted of 2.375% Convertible Senior Notes due March 15, 2022. Compared to previous convertible bond offerings, Tesla increased the interest rate on the bonds while lowering the “conversion” premium. The conversion premium allows for the bond holder to exchange their bond for common stock, Tesla has set the price of that conversion at $327.50, which is roughly 25% above current market value. Previous convertible bond offerings had a conversion premium of 42.5% above their respective market values and interest rates of .25% and 1.25%. (This analysis does not look at the debt offering SolarCity had before the Tesla-SolarCity merger last fall.)
“Secret” Investor Call
On March 16, a user on the Tesla Subreddit revealed that Elon Musk and other company officials were holding a conference call with the investors directly involved in the sale of shares and bonds. Tesla did not announce the call on its Investors Relations page nor provide a transcript of the call.
According to reddit member electricmusk who was affiliated with the raise and attended the call, Elon Musk revealed that there would be no “beta” version of the Model 3. Instead, the company is going straight to an “early release candidate.” In the industry, that normally refers to cars built on the actual assembly line that will be used for normal production.
If true, that suggests the Model 3 production line is now complete and ready to start producing cars. Later in the conference call, Musk is heard saying “we will be driving it (the early release candidate) within a week or two.” Musk reportedly said that advanced analytical techniques are allowing the company to skip the usual beta phase. He promised the Model 3 will have higher initial quality than either the Model S or Model X because of those analytical tools.
The quick transition to early release candidate cars has some people on Reddit concerned. john_atx, a first day Model 3 reservation holder, explained it this way.
“No, it does mean something. Start of production is July, and they don’t have any cars to test now in the middle of March. So let’s say they can start driving their cars by April. If an issue comes up, they have weeks to get it resolved. Normally you have a fleet of production intent cars driving in all conditions to get data. Tesla won’t have enough time to find the problems and implement corrective actions before Start of Production.”
Those who were able to listen in on the conference call report one other interesting tidbit. At one point, Elon Musk is heard to say — albeit indistinctly — that Tesla will transition to the 2170 battery cells for the battery packs in its Model S and Model X cars “by the end of the year,” according to reddit user electricmusk. Tesla’s 2170 lithium ion cells are currently being manufactured at Gigafactory 1 and being used in its commercial and home energy storage systems. The cells will also be used in the upcoming mass market Model 3 sedan.
Come join the discussion on Model 3 as Tesla prepares to put the vehicle into mass production.
Investor's Corner
Tesla could save $2.5B by replacing 10% of staff with Optimus: Morgan Stanley
Jonas assigned each robot a net present value (NPV) of $200,000.

Tesla’s (NASDAQ:TSLA) near-term outlook may be clouded by political controversies and regulatory headwinds, but Morgan Stanley analyst Adam Jonas sees a glimmer of opportunity for the electric vehicle maker.
In a new note, the Morgan Stanley analyst estimated that Tesla could save $2.5 billion by replacing just 10% of its workforce with its Optimus robots, assigning each robot a net present value (NPV) of $200,000.
Morgan Stanley highlights Optimus’ savings potential
Jonas highlighted the potential savings on Tesla’s workforce of 125,665 employees in his note, suggesting that the utilization of Optimus robots could significantly reduce labor costs. The analyst’s note arrived shortly after Tesla reported Q2 2025 deliveries of 384,122 vehicles, which came close to Morgan Stanley’s estimate and slightly under the consensus of 385,086.
“Tesla has 125,665 employees worldwide (year-end 2024). On our calculations, a 10% substitution to humanoid at approximately ($200k NPV/humanoid) could be worth approximately $2.5bn,” Jonas wrote, as noted by Street Insider.
Jonas also issued some caution on Tesla Energy, whose battery storage deployments were flat year over year at 9.6 GWh. Morgan Stanley had expected Tesla Energy to post battery storage deployments of 14 GWh in the second quarter.
Musk’s political ambitions
The backdrop to Jonas’ note included Elon Musk’s involvement in U.S. politics. The Tesla CEO recently floated the idea of launching a new political party, following a poll on X that showed support for the idea. Though a widely circulated FEC filing was labeled false by Musk, the CEO does seem intent on establishing a third political party in the United States.
Jonas cautioned that Musk’s political efforts could divert attention and resources from Tesla’s core operations, adding near-term pressure on TSLA stock. “We believe investors should be prepared for further devotion of resources (financial, time/attention) in the direction of Mr. Musk’s political priorities which may add further near-term pressure to TSLA shares,” Jonas stated.
Investor's Corner
Two Tesla bulls share differing insights on Elon Musk, the Board, and politics
Two noted Tesla bulls have shared differing views on the recent activities of CEO Elon Musk and the company’s leadership.

Two noted Tesla (NASDAQ:TSLA) bulls have shared differing views on the recent activities of CEO Elon Musk and the company’s leadership.
While Wedbush analyst Dan Ives called on Tesla’s board to take concrete steps to ensure Musk remains focused on the EV maker, longtime Tesla supporter Cathie Wood of Ark Invest reaffirmed her confidence in the CEO and the company’s leadership.
Ives warns of distraction risk amid crucial growth phase
In a recent note, Ives stated that Tesla is at a critical point in its history, as the company is transitioning from an EV maker towards an entity that is more focused on autonomous driving and robotics. He then noted that the Board of Directors should “act now” and establish formal boundaries around Musk’s political activities, which could be a headwind on TSLA stock.
Ives laid out a three-point plan that he believes could ensure that the electric vehicle maker is led with proper leadership until the end of the decade. First off, the analyst noted that a new “incentive-driven pay package for Musk as CEO that increases his ownership of Tesla up to ~25% voting power” is necessary. He also stated that the Board should establish clear guidelines for how much time Musk must devote to Tesla operations in order to receive his compensation, and a dedicated oversight committee must be formed to monitor the CEO’s political activities.
Ives, however, highlighted that Tesla should move forward with Musk at its helm. “We urge the Board to act now and move the Tesla story forward with Musk as CEO,” he wrote, reiterating its Outperform rating on Tesla stock and $500 per share price target.
Tesla CEO Elon Musk has responded to Ives’ suggestions with a brief comment on X. “Shut up, Dan,” Musk wrote.
Cathie Wood reiterates trust in Musk and Tesla board
Meanwhile, Ark Investment Management founder Cathie Wood expressed little concern over Musk’s latest controversies. In an interview with Bloomberg Television, Wood said, “We do trust the board and the board’s instincts here and we stay out of politics.” She also noted that Ark has navigated Musk-related headlines since it first invested in Tesla.
Wood also pointed to Musk’s recent move to oversee Tesla’s sales operations in the U.S. and Europe as evidence of his renewed focus in the electric vehicle maker. “When he puts his mind on something, he usually gets the job done,” she said. “So I think he’s much less distracted now than he was, let’s say, in the White House 24/7,” she said.
TSLA stock is down roughly 25% year-to-date but has gained about 19% over the past 12 months, as noted in a StocksTwits report.
Investor's Corner
Cantor Fitzgerald maintains Tesla (TSLA) ‘Overweight’ rating amid Q2 2025 deliveries
Cantor Fitzgerald is holding firm on its bullish stance for the electric vehicle maker.

Cantor Fitzgerald is holding firm on its bullish stance for Tesla (NASDAQ: TSLA), reiterating its “Overweight” rating and $355 price target amidst the company’s release of its Q2 2025 vehicle delivery and production report.
Tesla delivered 384,122 vehicles in Q2 2025, falling below last year’s Q2 figure of 443,956 units. Despite softer demand in some countries in Europe and ongoing controversies surrounding CEO Elon Musk, the firm maintained its view that Tesla is a long-term growth story in the EV sector.
Tesla’s Q2 results
Among the 384,122 vehicles that Tesla delivered in the second quarter, 373,728 were Model 3 and Model Y. The remaining 10,394 units were attributed to the Model S, Model X, and Cybertruck. Production was largely flat year-over-year at 410,244 units.
In the energy division, Tesla deployed 9.6 GWh of energy storage in Q2, which was above last year’s 9.4 GWh. Overall, Tesla continues to hold a strong position with $95.7 billion in trailing twelve-month revenue and a 17.7% gross margin, as noted in a report from Investing.com.
Tesla’s stock is still volatile
Tesla’s market cap fell to $941 billion on Monday amid volatility that was likely caused in no small part by CEO Elon Musk’s political posts on X over the weekend. Musk has announced that he is forming the America Party to serve as a third option for voters in the United States, a decision that has earned the ire of U.S. President Donald Trump.
Despite Musk’s controversial nature, some analysts remain bullish on TSLA stock. Apart from Cantor Fitzgerald, Canaccord Genuity also reiterated its “Buy” rating on Tesla shares, with the firm highlighting the company’s positive Q2 vehicle deliveries, which exceeded its expectations by 24,000 units. Cannacord also noted that Tesla remains strong in several markets despite its year-over-year decline in deliveries.
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