Tesla stock drops as Elon Musk gives bizarre earnings call

Earnings


Shares in Tesla took a nosedive in after-hours trading today as Elon Musk cut off analysts during a first-quarter earnings call. He dismissed a question about gross margins from Bernstein senior analyst Toni Sacconaghi as “boring.” Instead, Musk and other executives answered multiple questions from a Tesla enthusiast and Youtuber named Gali Russell.

The 25-year-old retail investor tweeted at Elon Musk on Monday, seeking to ask him a “crowdsourced” question during Wednesday’s conference call. Instead of a single question, Russell was able to ask several.

The stock drop may have become apparent around the time when Musk cut off analysts on the call. However, the company’s first-quarter update has also stoked concerns over Tesla’s cash burn and how, exactly, it will improve margins while ramping Model 3 production.

On the first-quarter call, CEO Elon Musk also promised a “reorganization” this month. He said:

“I’m feeling quite confident about hitting positive cash flow in Q3. This is not a certainty. It does appear quite likely in my view. We are going to conduct a reorganization, restructuring of the company this month and make sure we are well set up to achieve that goal. In particular the number of third-party companies we’re using has gotten out of control. We’re going to scrub the barnacles on that front.”



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