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NVIDIA announced earnings that exceeded market expectations, sparking an artificial intelligence (AI) rally on Wall Street. It was like a “NVIDIA party” happening on Wall Street.
However, Tesla was not a part of this “party.”
On the 21st, NVIDIA announced its performance results that beat market expectations and had a positive outlook.
As a result, when NVIDIA soared more than 16%, AMD, known as the second NVIDIA, also surged 11% on the 22nd. This caused the Philadelphia Semiconductor Index, a semiconductor group, to surge 5%, leading to an AI rally led by NVIDIA unfolding on Wall Street.
However, Tesla only rose 1.36%.
Although the NVIDIA rally continued onto the 23rd, Tesla’s stock price fell nearly 3%. Tesla closed the market at $191.97, a 2.76% drop.
Things haven’t been looking up for Tesla. With the sharp decline in demand for electric cars in the United States and the rise of Chinese electric car companies such as BYD, Tesla’s stock price has been unable to avoid sluggishness this year.
Institutional investors in Tesla predict that Tesla’s stock price will be weak for the next 6-12 months.
Yet, Tesla investors can’t let go of the company’s stock because they believe it is more than just an electric car company.
Tesla is pushing for autonomous vehicles. Autonomous vehicles are expected to be one of the prospects of generative AI.
However, it seems that Tesla was not a part of the “NVIDIA party” because Tesla has not yet announced any significant AI investments.
Last January, Tesla CEO Elon Musk stated, “Without about 25% control, it’s hard to enter the AI industry actively. Therefore, if 25% of the voting rights are not secured, we must start an AI business outside of Tesla.”
Elon Musk currently owns about 13% of Tesla’s stock. It was originally 20%, but it dropped to 13% after he sold some stocks while acquiring Twitter.
He threatened to set up an independent company and operate an AI business if he did not get more voting rights because he had not secured enough to enter the AI business at Tesla actively.
If Musk starts an AI-related business outside of Tesla, Tesla will be no different from a regular electric car company. This means that the premium of Tesla, which is not a simple electric car company, disappears.
sinopark@news1.kr