Tesla’s stock has surged over 5% in after-hours trading, despite reporting results that are significantly lower than market expectations. The company plans to launch its budget vehicle on schedule in the first half of the year, and CEO Elon Musk will return to the company in May.
As of 8 p.m. on Tuesday, Tesla’s stock was up 5.34% in after-hours trading on the New York Stock Exchange, reaching 250.68 USD.
The stock had already climbed 4.60% during regular trading hours, resulting in a combined increase of about 10% for the day.
Analysts attribute the stock’s surge primarily to Musk’s anticipated return.
During a post-earnings conference call with analysts, Musk stated that starting in May, he would likely spend significantly less time on the Department of Government Efficiency, adding that he has largely completed his government-related activities.
He noted that, if necessary, he could dedicate one to two days a week to government work, as there is a possibility that the waste and fraud they had curtailed might resurface.
Musk confirmed that he will refocus his attention on Tesla beginning in May.
This announcement has raised concerns about potential paralysis within the Department of Government Efficiency, which now faces an abrupt leadership vacuum.
During the earnings call, Tesla also revealed that the development of its budget electric vehicle model, targeted for release in the first half of 2025, is progressing as planned.
This statement directly contradicts a recent Reuters report suggesting Tesla’s low-cost electric vehicle plans had been delayed until year-end. The company also announced plans to begin mass production of autonomous vehicles next year.
These positive announcements have further bolstered Tesla’s stock price.
However, the company’s quarterly earnings fell well short of market expectations. Earnings per share came in at 27 cents, significantly below the projected 39 cents and representing a 71% year-over-year decline.
Revenue stood at 19.34 billion USD, also missing the expected 21.11 billion USD, with total sales down 9% compared to the previous year. Electric vehicle sales took a particularly hard hit, dropping to 14 billion USD, a 20% year-over-year decline.
Despite these disappointing results, investors seem encouraged by Musk’s impending return and the anticipated launch of Tesla’s robotaxi next year, driving the stock’s after-hours rally.