Connect with us

Investor's Corner

Tesla (TSLA) short responds to Elon Musk’s invite with odd demands and side remarks

Published

on

Tesla (NASDAQ:TSLA) short and hedge fund manager David Einhorn has issued a response to Elon Musk’s invitation to meet and visit the electric car maker’s facilities. Einhorn agreed to meet with Musk in his response, though he had a number of odd demands and remarks that went along with his acceptance. 

Similar to Musk’s letter, Einhorn’s response was long and posted on Twitter via a screenshot. In it, the Greenlight Capital President challenged the Tesla CEO, claiming that while both his hedge fund and Tesla “struggled” last year, his business has generated “real profits for investors” since it was established in 1996. He also denied that his TSLA short has performed badly as well, arguing that it has merely “fluctuated.” 

Following is Einhorn’s letter to Musk in full. 

Dear Elon, 

Advertisement
-

I am glad that you read our October letter and would like to discuss it. You say we “made numerous false allegations against Tesla.” 

Could you be more specific? Can you point to at least one sentence that is false and refute it with facts? We certainly are capable of making mistakes and if we said anything false, we will correct it for the record. Facts do matter to us. I can’t imagine how it would feel to have entire websites like https://elonmusk.today chronicling your untruths.

Our business have some similarities and differences. We both struggled last year. However, a key difference is that Greenlight’s business has generated real profits for our investors since we began in 1996. Tesla’s business financials reflect a decade of annual losses and an accumulated deficit of $6 billion, despite billions of dollars of taxpayer subsidies. 

As for our short of Tesla, it’s fluctuated. In a multi-year bull market, it hasn’t performed badly. By continually changing the narrative and narrowly averting crisis after crisis, you have certainly kept it interesting. We shall see what happens from here. 

We welcome your offer to let us learn more about Tesla and will take you up on it. This is a stark contrast from Tesla’s prior position, as your IR team has refused several requests from us to converse directly and answer our questions. 

I think facility visits would be fun (can we start in Buffalo?). I might learn the difference between your alien dreadnought factory and cars made by hand in a tent. 

Advertisement
-

The truth is we are much more interested in, and have many questions about, your financial statements.  Perhaps, we could spend some time together with your CFO, Zach Kirkhorn. 

As an example, my understanding of auto sales is that car buyers don’t typically drive off the lot without paying for the car. Publicly-traded auto dealers have only a couple days of account receivable balances. Yet, Tesla is owed over $1 billion by its customers. With customers paying up front, why are the balances so high? In September 2018, you said the receivables doubled up because the quarter ended on a Sunday. That answer wasn’t very satisfying at the time. This year, the quarter ended on a weekday. Sales are lower than they were a year ago and yet, the receivables were high. We are curious. 

We have dozens of questions like that. 

I truly appreciate your offer to build a direct communication so we can learn more about Tesla. Please advise on how we should go about scheduling. And have a nice weekend. 

David Einhorn

Looking at Einhorn’s response, it appears that the TSLA short is not really taking an open-minded approach in responding to Musk’s letter. Instead, Einhorn seems to be doubling down on his allegations of fraud against Musk with his suggestion that the electric car maker’s finances don’t line up. With such a response, including snide, outdated references to GA4, it would not be very surprising if Tesla does not choose to go forward with Elon Musk’s initial invitation.  

Advertisement
-

This is quite ironic considering that Einhorn himself and his fund, Greenlight Capital, were fined by the UK Financial Service Authority (FSA) for £7.2 million (US$9.27 million) for insider trading. According to the FSA, Einhorn engaged in “market abuse” in relation to a fundraising by pub group Punch Taverns in June 2009. Greenlight has also struggled over the past year, being unable to beat the market and declining 34% last year, its worst year since the fund was founded.

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.

Advertisement
Comments

Investor's Corner

SpaceX’s biggest earnings test yet lands Tuesday, and Tesla shareholders should be watching

SpaceX reports earnings Tuesday as Wall Street watches AI spending, Starlink growth and Tesla merger

Published

on

By

SpaceX reports third quarter results after the market closes Tuesday, with a webcast at 4:30 p.m. ET streamed on X, and Tesla follows a day later. Bloomberg consensus, cited by Pepperstone, calls for revenue of $12.89 billion, adjusted EBITDA of $6.62 billion and adjusted EPS near $0.15. That would be about 65% growth from the second quarter and SpaceX’s first profitable quarter since its IPO. Analysts expect roughly $6.4 billion from AI and $4.9 billion from Starlink, which is projected to reach 14.3 million consumer subscribers. Capital spending is forecast at $19.6 billion, leaving free cash flow near negative $11.6 billion.

The numbers matter because SpaceX has spent months trying to win over a skeptical market. It priced its record IPO at $135, spiked to $225.64, then sank near $105 in early August. Friday’s close of $146.03 sits about 28% below the June high. The Q2 report beat on revenue at $7.8 billion and put Starlink at 12 million subscribers, but $18.4 billion of capex hurt the stock. Since then SpaceX reached orbit on Starship Flight 14 with 26 Starlink V3 satellites, agreed to buy 800 MHz spectrum for about $8 billion as part of its Starlink Mobile push, and signed a fourth compute hosting deal in four months worth roughly $13 billion a year from December. Management is targeting more than 2 gigawatts of compute by year end and a $100 billion annualized revenue run rate. Evercore ISI, which raised its target to $275, said the quarter may be judged more on those targets than the reported figures

All of this sits under the Tesla merger question. Barclays analyst Dan Levy expects an all stock deal in which SpaceX buys Tesla at a premium, using reference values of $2.1 trillion and $1.5 trillion, and said an announcement would need to come by late October or early November to be voted on at Tesla’s December 6 annual meeting. Barclays estimates Musk would hold about 37% of the combined company and 56% of the votes. Musk said in July that combining companies cannot be discussed on an earnings call, but an investor question asking when SpaceX will merge with Tesla is sitting on SpaceX’s Q&A platform, and Teslarati has tracked how the Roadster demo revived the talk.

If a deal happens, Tuesday’s result would effectively set the price Tesla holders would receive. Their shares would convert into SpaceX stock, along with exposure to a company with a heavy investment on AI, while Tesla itself expects 2026 capex above $25 billion. A strong quarter and calmer spending would make that exchange easier to sell. Another round of heavy capex and a falling stock would make it harder.

Continue Reading

Investor's Corner

Tesla’s flying Roadster just revealed something bigger than the car

Analysts say the Roadster demo puts a Tesla and SpaceX merger back on the table.

Published

on

By

Tesla’s new Roadster, upside down and trailing cold gas thruster smoke, flips over a lineup of Tesla vehicles at the Roadster unveiling near Waco, Texas on October 15, 2026. (Image: Tesla)
Tesla’s new Roadster, upside down and trailing cold gas thruster smoke, flips over a lineup of Tesla vehicles at the Roadster unveiling near Waco, Texas on October 15, 2026. (Image: Tesla)

The Roadster unveiling near Waco ended Thursday night, and by Friday morning much of the investor reaction had less to do with the car than with who owns the rocket technology inside it.

Wedbush analyst Dan Ives said the event “puts the Tesla/SpaceX relationship on the table in a tangible way,” pointing to the propulsion, pressure vessel and control hardware sitting on a Tesla product. Gene Munster of Deepwater Asset Management called the demo “a ridiculous display of engineering” with “no commercial value” beyond embarrassing traditional automakers, though he said it showed Musk wants the two companies together.

The more specific forecast came a day earlier from Barclays. Analyst Dan Levy told clients a deal could be announced before Tesla’s annual meeting, which must happen by December 6, and that an announcement in late October or early November could make shareholder approval harder. Barclays expects SpaceX to be the buyer in an all stock deal, with Tesla holders receiving SpaceX shares at a premium, based on market values of roughly $2.1 trillion for SpaceX and $1.5 trillion for Tesla. If nothing lands around the meeting, the bank still sees an announcement within 6 to 12 months.

The Roadster demo just added more weight to merger speculations. Tesla’s demo used cold gas thrusters and pressure tanks of the kind SpaceX uses on Falcon 9, and Musk described the car as a collaboration between Tesla and SpaceX engineers, as we mentioned in our breakdown of the three Roadster configurations.


Musk has not publicly addressed a deal since the event, as far as we have seen. His most direct answer remains the one he gave at the All In Summit, when he said that with so much collaboration, “who can imagine what action one might take” without ruling anything out. Ives has held to a 2027 timeline since his March note, and Musk pushed back on the China piece of the speculation when ARK floated a year end announcement in August.

The next test is Tesla’s third quarter earnings call on October 21. However, we recall in July that Musk told analysts, “we can’t talk about combining companies and that kind of thing on an earnings call,” so a clear answer wouldn’t be expected.

Advertisement
-
Continue Reading

Elon Musk

Elon Musk breaks his silence on the Starlink impact to Ukraine drones

Musk says the US military and president set Starshield limits, not SpaceX, amid Ukraine complaints.

Published

on

By

Elon Musk says the speed limit cutting out Ukraine’s military Starlink terminals is not SpaceX’s decision. In a post on X Wednesday, Musk wrote that “Starshield systems are owned and controlled by the US government. Any limits on speed or usage are decided by the US military and ultimately POTUS.” He added that Starlink is a commercial service limited to civilian or defensive activities and “cannot be used for offensive military action, as doing so would be inappropriate for a commercial company.”

He was replying to Mykhailo Fedorov, Ukraine’s former defense minister, who had thanked Musk for restoring connectivity at speeds up to 160 km/h and said removing the Starshield limit entirely is “now critical for Ukraine’s defense.”

The complaint started Tuesday night, when Ukrainian officials said military terminals began losing service above roughly 100 mph. Presidential adviser Serhiy Beskrestnov said the defense forces got no warning and several missions were disrupted, as Teslarati reported earlier Wednesday. The 7th Rapid Reaction Corps told Reuters connections dropped for 10 to 20 seconds at speeds well below the limit, which made drones harder to control. Poland’s foreign minister, Radoslaw Sikorski, asked Musk on X whether he is “playing politics with your products again.”

Advertisement
-

That is why the Starlink and Starshield distinction matters. SpaceX introduced Starshield in 2022 as the government version of Starlink, with an initial focus on Earth observation, communications and hosted payloads. It won a Space Force contract in 2023 with a $70 million ceiling. In December 2024, the Pentagon moved Ukraine’s terminals onto Starshield, covering about 3,000 units across two contracts. Ukraine’s military connections therefore run through a service that Musk now says sits under Washington’s control.

SpaceX pitches subscription model for Trump’s Golden Dome

While Musk’s post describes who holds authority, it does not infer that anyone ordered the limit, and neither SpaceX nor the US government has confirmed who set it. Ukrainian officials have pointed to the timing, which follows President Trump’s push for an energy ceasefire and Musk’s Saturday post that “Zelensky has gone too far.” The BBC noted Trump denied threatening to restrict intelligence sharing with Kyiv, and no evidence has been presented that Washington requested the cap.

The episode also revives a promise from 2025. After Poland accused him of threatening Ukraine’s access, Musk said Starlink “will never turn off its terminals” and would not be used as a bargaining chip. Poland has since supplied more than 29,000 terminals to Ukraine. Teslarati also covered Kyiv’s search for Starlink alternatives in 2025, and the latest dispute gives that search new urgency.

Continue Reading