Business
Tesla Profits Plunge 71% as Musk’s Investors Push Him to Step Away from Politics
By Jake Beardslee · April 23, 2025
Tesla Misses Q1 Targets as Musk’s Split Focus Draws Scrutiny
Tesla's first-quarter earnings report fell significantly short of Wall Street expectations, as CEO Elon Musk continues to divide investor sentiment with his dual focus on the electric vehicle giant and his controversial leadership role in the Trump administration’s Department of Government Efficiency, or DOGE. The White House / Wikimedia
Profits Plunge 71%, Revenue Falls Short of Forecasts
Tesla reported earnings of 27 cents per share, well below analysts' forecasts of 41 cents, according to FactSet. Revenue also disappointed, falling 9% to $19.3 billion, compared to the expected $21.3 billion. Net income dropped 71% year-over-year to $409 million. Calreyn88 / Wikimedia
Investors Push Musk to Refocus on Tesla Over Politics
Investor frustration is mounting, particularly over Musk's priorities. “Can Elon please provide some reassurance that at some point soon he will be done with DOGE and politics?” one shareholder asked, according to CBS News. “Many Tesla shareholders wish he would reprioritize the majority of his time and effort to engineering.” Chad Davis / Wikimedia
Stock Down 53% Since December
The company’s stock has plunged 53% since December, when Musk’s political involvement initially buoyed investor hopes. But backlash to his federal workforce cuts and handling of taxpayer data has since eroded consumer confidence among some and triggered protests. The drop in deliveries by nearly 13% this past quarter reflects waning demand. Ian M. / Wikimedia
Musk Says He’ll Scale Back DOGE Role Starting in May
On Tesla's earnings call, Musk responded directly: “Starting probably in next month, in May, my time allocation to DOGE will drop significantly,” though he clarified that he will still spend one to two days per week on government matters. “Starting next month, I’ll be allocating far more of my time to Tesla.”Musk defended his government work, stating he aims to “fight the waste and fraud and try to get the country back on the right track.” Office of Speaker Mike Johnson / Wikimedia
Analysts Warn Musk’s Political Ties Hurt Tesla’s Brand
But analysts remain skeptical. “Musk needs to leave the government, take a major step back on DOGE, and get back to being CEO of Tesla full-time,” wrote Dan Ives of Wedbush. He warned that Tesla’s association with Trump-era politics may deter 15% to 20% of potential buyers. Pixabay / Pexels
Tariffs Drive Up Prices as Musk Calls for Lower Rates
Further complicating the outlook are rising vehicle prices due to Trump’s tariffs, which Musk criticized: “I’m advocating for lower tariffs, rather than higher, but that’s all I can do.” The White House / Wikimedia