NEW YORK (AP / By BERNARD CONDON) — Tesla’s first-quarter profits plunged by more than two-thirds amid backlash against Elon Musk’s electric car company that has hurt sales and sent its stock plunging.
The Austin, Texas, company said Tuesday that quarterly profits fell by 70% to to $409 million, or 12 cents a share. That’s far below analyst estimates. Tesla’s revenue fell 9% to $19.3 billion in the January through March period, below Wall Street’s forecast.
The disappointing results come as the company is fighting a backlash due to Musk’s leadership of a federal government jobs-cutting group that has divided the country and sparked angry protests. Musk also has publicly supported far-right politicians in Europe and alienated potential buyers there, too.
Many investors have complained Musk is too distracted with his Trump administration role to be running Tesla and that he should either relinquish his position as CEO or abandon his advisory role in Washington.
Tesla’ stock has fallen more than 40% this year but rose slightly in after-hours trading.
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Tesla will hold a conference call to review the quarterly results and give a company update later Tuesday afternoon.
Tesla investors will be listening closely for updates on several strategic initiatives. The company is expected to roll out a cheaper version of its best-selling vehicle, the Model Y SUV later in the year. Tesla has also said it plans to start a paid driverless robotaxi service in Austin, Texas, in June.
The company that once dominated EVs is also facing fierce competition for the first time.
Earlier this year, Chinese EV maker BYD announced it had developed an electric battery charging system that can fully power up a vehicle within minutes. And Tesla’s European rivals have begun offering new models with advanced technology that is making them real alternatives, just as popular opinion in Europe has turned against Musk.
Investors expect Tesla will be hurt less by the Trump administration’s tariffs than most U.S. car companies because it makes most of its U.S. cars domestically. But Tesla won’t be completely unscathed. It sources some materials from abroad that will now face import taxes.
Retaliation from China will also hurt Tesla. The company was forced earlier this month to stop taking orders from mainland customers for two models, its Model S and Model X. It makes the Model Y and Model 3 for the Chinese market at its factory in Shanghai.
