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Tesla (TSLA) drops in the aftermath of Q1 earnings: Here’s Wall St’s take

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Tesla stock (NASDAQ:TSLA) experienced a 3% drop on Thursday’s intraday as the electric car maker felt the aftermath of its Q1 2019 earnings. The company posted a loss of $702 million or $4.10 a share in the first quarter, which is almost comparable to Q1 2018’s loss of $4.19 per share.

Tesla CEO Elon Musk and the company’s executives explained during the Q1 2019 earnings call that the company’s lower-than-expected performance was due to one-time items and circumstances such as delivery delays for the Model 3 in Europe and China. With Tesla back in the red, here is what Wall Street analysts are now saying.

Wedbush analyst Daniel Ives, a longtime TSLA bull, downgraded Tesla from “Outperform” to “Neutral” while adjusting his price target for the company from $365 per share to a far more conservative $275 per share. Ives also penned a scathing note on Thursday, calling Tesla’s Q1 results as one of the “top debacles” Wedbush has ever seen, and criticizing the company’s executives for their belief that demand and profitability will “magically” return in the coming quarters.

“In our 20 years of covering tech stocks on the Street, we view this quarter as one of the top debacles we have ever seen while Musk & Co. in an episode out of the Twilight Zone act as if demand and profitability will magically return to the Tesla story. Ultimately we believe the company’s guidance is aggressive and management/board is not taking aggressive enough cost-cutting actions and shutting down future endeavors to preserve capital and give a sustained path to profitability for the Street. We no longer can look investors in the eye and recommend buying this stock at current levels until Tesla starts to take its medicine and focus on the reality around demand issues which is the core focus of investors,” Ives wrote.

Ryan Brinkman of JP Morgan noted that a negative reaction was already expected considering Elon Musk’s previous comments about Tesla’s inability to turn a profit in Q1. Brinkman, who has an “Underweight” rating and a $200 price target on TSLA stock, also pointed out Tesla’s willingness to do a capital raise this year. “Management also seemed less opposed to an equity capital raise, acknowledging “some merit” to the idea, which in our view serves to highlight dilution risk that likely rises after 1Q cash flow and cash balance tracked weaker than JPM and consensus expectations. While 2Q deliveries guidance appears potentially aggressive, the full year outlook for 360-400K implies a further roughly +35% to +45% sequential increase from 1H19 to 2H19, further highlighting the execution risk entailed in meeting the figures that are implied needed to generate positive earnings and cash flow,” he wrote.

Joseph Spak from RBC noted that Tesla’s Q1 numbers were “uglier than expected,” while stating that a capital raise will likely be held this year. Similar to Brinkman, Spak reiterated his “Underweight” rating and $200 price target for Tesla stock. “Elon talked about putting Tesla on a ‘Spartan diet’ and while we don’t doubt the company spent inefficiently in the past, the low capex+R&D and of course the lower sales, are not hallmarks of a hyper-growth company, yet TSLA continues to be valued as one,” he wrote.

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Evercore ISI analyst Arndt Ellinghorst also proved bearish on the company, expressing his reservations about Tesla in a segment of CNBC‘s Street Signs. The analyst was skeptical of the demand for Tesla’s vehicles, even noting that the Model S sedan and the Model X SUV are already starting to look “quite old.” “If you claim that demand is huge and unlimited then the key question is, why do you lower your mix? Why do you lower your pricing? I mean the S and the X are quite advanced in any normal life cycle of a product so they would really need a significant refresh in order to restore the pricing. The brand will be less exclusive than it has been in the past,” the Evercore ISI analyst said.

Not all analysts covering the company were bearish after Tesla’s release of its first-quarter results. In a note, Piper Jaffray analyst Alexander Potter opted to look into the coming quarters for a potential recovery, while pointing out that Tesla’s shortcomings in Q1 were the result of several factors. “Although logistical challenges—long with lower transaction prices—had an obvious impact on Q1 profitability, we think this was temporary,” analyst Alexander Potter wrote in a note. “Guidance implies a second-half recovery for both deliveries and margins, and this seems reasonable to us. The first quarter suffered from a particularly nasty combination of headwinds, including seasonality, a big buildup of non-US deliveries (negative for logistics costs and working capital), as well as the expiration of tax incentives in the United States,” Potter wrote.

As of writing, Tesla is trading down -3.35% at $250.00 per share.

Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Elon Musk

X changed how everyone gets paid, and this lawsuit shows why

X sued a Bitcoin account network over fake payouts as its creator pay model shifts

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Elon Musk’s X has taken a Bitcoin-focused engagement ring to court, and the case doubles as a receipt for how differently the platform pays creators today. The company filed suit in the High Court of England and Wales against Vivek Kumar Sen and Zamyang Sherpa, alleging the pair ran six accounts, including @Vivek4real_, @Bitcoin_Teddy and @TrendingBitcoin, as one coordinated operation to fake the kind of engagement that used to translate directly into money.

According to the filing, first reported by Gizmodo, the accounts posted near identical “BREAKING” crypto headlines seconds apart, in one case 11 seconds, then had three more handles like, reply to and repost the material to manufacture what X called “a false appearance of genuine, human communication and interaction.” X says the scheme pulled in at least £207,384, about $278,000, and pegs its own investigation and remediation costs at another £75,000. The accounts were suspended August 18. X general counsel James Burnham announced the case on X last weekend, writing that the company “will act forcefully to protect our platform and the earnings of genuine creators.” Musk’s own reaction, posted shortly after, was three words: “Don’t mess with 𝕏.”

The timing lines up with a a recent update to how X pays its creators. The program these accounts allegedly gamed, Creator Revenue Sharing, launched in mid 2023 and paid out based on how much a post got engaged with. Originality was never part of the formula, which is exactly how the platform ended up flooded with recycled clips, copy pasted “BREAKING” posts and replies engineered purely to farm reactions from paying subscribers.

X tried patching the model more than once, including an April cut to aggregator payouts and a March regional weighting change that Musk personally paused hours after it was announced. X retired Creator Revenue Sharing for good on September 7 and opened its replacement, Original Content Rewards, the next day.

The new math is stricter. Payouts now come only from qualified impressions, meaning unique Home Timeline views from Premium subscribers where at least half the post is visible, and replies no longer count toward eligibility at all. Copied posts, reuploaded media and reposts without meaningful changes are explicitly excluded. Allegra Jacchia, senior product manager for Creators at SpaceXAI, which now runs X’s product and AI work following xAI’s acquisition of the platform, put it bluntly, saying the goal is to reward creators who bring original ideas and perspective, “not those who have become best at gaming the system.”

Read that way, the lawsuit isn’t really about six crypto accounts. It’s X putting a dollar figure on what the old incentive structure cost, then suing to collect it right as the new one goes live. For live updates on how the case and the new rewards program shake out, follow @Teslarati on X.

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Why automakers keep turning down Elon Musk’s Tesla Full Self-Driving offer

Elon Musk confirms no automaker has ever accepted Tesla’s offer to license Full Self-Driving software.

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Elon Musk gave a brief answer on X Monday that confirmed that Tesla’s standing offer to license Full Self-Driving to other automakers still has zero takers. Sawyer Merritt wrote that “Tesla has for years openly invited other automakers to license FSD. None of them have accepted,” responding to a prediction from Boom Supersonic founder Blake Scholl that Tesla would eventually open FSD the way it opened its Supercharger network to rival brands. Musk’s reply to Merritt was one word: “Exactly.”

It is not the first time Musk has made this point. He said something similar in November, when he called legacy automakers reluctance to adopt FSD “crazy,” and Tesla has floated the offer publicly since at least 2021. Scholl’s prediction touches on something real. Once NACS became the de facto charging standard, adoption from Ford, GM, Rivian and others followed within about a year. FSD licensing was supposed to work the same way once Tesla built enough of a lead that switching made sense for everyone.

The case for licensing now is stronger than it was two years ago. Waymo and Zoox are logging hundreds of thousands of unsupervised autonomous miles, along with Tesla’s own Robotaxi fleet. Every automaker still selling driver assist systems that lag FSD has given the robotaxi conversation to Tesla, Waymo and Zoox by default. Licensing FSD would let a GM or a Ford compete on the same field without spending a decade and billions of dollars building a stack from scratch, the same argument Tesla made when it opened the Supercharger network to bring more EVs onto its chargers.

But FSD is not a connector standard. As one reply to Musk’s post pointed out, licensing FSD is not a software license the way NACS was a plug spec. It requires adopting Tesla’s eight camera layout and its onboard compute architecture, meaning a licensee’s cars would effectively become Tesla hardware wearing someone else’s badge. That is the visible obstacle. The less visible one is data. A licensed FSD stack would report back the same telemetry Tesla collects from its own fleet, giving Tesla a continuous read on how a competitor’s cars are actually driven, where they struggle, and how often drivers intervene. For an automaker trying to build its own autonomy program, or simply trying to keep its build quality and safety record private, handing Tesla that visibility could be a bigger cost than the hardware bill. It is the reason the Supercharger comparison only goes so far. Opening a charging plug cost Tesla very little. Opening FSD would cost a rival something it cannot get back.

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Elon Musk

Tesla eyes supply partners for Optimus mass production

Tesla certified three Chinese suppliers for Optimus mass production, signaling its robot timeline is accelerating.

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Concept rendering of Tesla Optimus in mass production

Tesla’s robotics team traveled to Ningbo, in China’s Zhejiang province, on September 16 and spent the following day auditing component suppliers for Optimus, according to a Bloomberg report cited by RobotAIGeek. The visit moved three manufacturers from provisional status to certified mass production partners: Tuopu Group, which handles actuators and chassis components, Ningbo Joyson Electronic, a sensor supplier, and Zhejiang Sanhua Intelligent Controls, which builds thermal management systems. All three already supply parts to Tesla’s electric vehicles, and the audit reportedly came with fresh orders that supply chain reports put at an initial batch of roughly 5,000 units.

Tuopu, Joyson, and Sanhua built their manufacturing base serving the automotive industry, where tolerances and volume requirements are already close to what a mass produced humanoid robot demands. Sanhua in particular has history here. Teslarati reported last October that the company had received a roughly $685 million order for linear actuators tied to Optimus, a volume industry watchers estimated could cover around 180,000 robots once production ramped.

Supply chain reports tied to this week’s audit put Tesla’s near term production goal at about 1,000 Optimus units a week by late September, rising to 2,000 to 2,500 units a week by the end of the year. That pace would put real weight behind the timeline Tesla has been building toward since May, when it wound down Model S and Model X production at Fremont to convert that floor space into a dedicated Optimus line targeting one million units annually. JPMorgan analysts who toured the factory in August confirmed the conversion took roughly four months, a pace Musk has called unprecedented for a facility that size.

New drone video shows Tesla’s Optimus Factory reaching a turning point

Fremont is only the first phase. A second, larger Optimus plant is rising at Gigafactory Texas, where drone footage shared by Joe Tegtmeyer last week showed the structural steel nearing completion on the north end of the building. Tesla has said that facility is meant to eventually support production of up to 10 million units a year, though volume output there is not expected before 2027.

Commercial sales of Optimus are still targeted for the second half of 2027, but production is expected to start well before then. JPMorgan analyst Rajat Gupta has said Tesla’s “Optimus Academy” program, which uses early units to collect real world training data inside Tesla’s own facilities, is expected to be running later this year. Bloomberg Intelligence analyst Ian Ma described the Ningbo audits as “a positive commercialization signal for China’s humanoid supply chain,” noting that sentiment could improve further if the visit leads to confirmed supplier nominations and larger orders. The Solactive China Humanoid Robotics Index rose about 1.4% on the news, though it remains down roughly 30% for the year.

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