Latest news with #Optimus
Miami Herald
4 hours ago
- Automotive
- Miami Herald
Elon Musk's Tesla problem just got worse
Once the darling of the electric vehicle world, Tesla (TSLA) has taken a fall this year - and it's one CEO Elon Musk is struggling to correct. While many blame Tesla's struggles on Musk's involvement in political matters, if you follow the EV company closely, you already know that it already faced problems back in 2024. Don't miss the move: Subscribe to TheStreet's free daily newsletter That year, Tesla delivered less vehicles - about 1.79 million vehicles in 2024, down 1.1% from 2023 - marking its first-ever full-year sales drop. Related: Elon Musk is bringing Robotaxis to a new city But that merely foreshadowed what was to come. After Musk joined The White House as a special government employee to run the Department of Government Efficiency (DOGE), his attention was fully focused elsewhere - and that had a painful effect on Tesla. When the EV company shared its Q1 results in an earnings call on April 22, it reported a 20% decline in revenue. And with the $7,500 tax credit for electric car buyers expiring come October, it's likely to deal Tesla another blow. On top of all that, now Musk has another problem to deal with - and it's revealing that people who once had great faith in Tesla are losing hope. Sales, Service and Delivery Vice President Troy Jones has left the company, per reporting from The New York Times. Jones, who led Tesla North America, had been with the company for 15 years and has always been a passionate supporter of Tesla's vision on his social media platforms. Now Jones joins a list of several key Tesla leaders who have departed this year, including Musk top aide Omead Afshar, HR Director for North America Jenna Ferrua, and Vice President of Engineering Milan Kovac, who oversaw Tesla's Optimus development. Related: Elon Musk announces a groundbreaking change coming to Tesla Musk has also sustained losses at one of his other companies. Last week, X CEO Linda Yaccarino stepped down after only two years with the company, saying on Twitter, "I'm incredibly proud of the X team - the historic business turnaround we have accomplished together has been nothing short of remarkable." Musk replied with "Thank you for your contributions," taking a tone that elicited much discussion over the state of the business relationship between the two. Musk has many vocal supporters in the investing world, including Wedbush Securities analyst Dan Ives and Ark Invest CEO Cathie Wood. But despite heaping praise on Musk in the past, even these fans seem to have lost a bit of faith. "Very simply, Musk diving deeper into politics and now trying to take on the Beltway establishment is exactly the opposite direction that Tesla investors/shareholders want him to take during this crucial period for the Tesla story," Ives wrote recently, leading Musk to tweet "shut up" to Ives a few days later. Wood, whose Ark Invest ETF holds its largest weight in Tesla stock at 9.78%, has remained staunchly devoted to her outlook on Musk and his companies. Wood's funds bought 115,400 shares of Tesla on July 16 in two funds, the ARK Innovation exchange-traded fund and the ARK Next Generation Internet ETF. "Harnessing breakthroughs in AI, robotics, and energy storage, @elonmusk is the most productive human being on earth and in space in history. Facts are facts," she tweeted on July 9. In the meantime, Musk hasn't paid much attention to Jones' departure or any of the rest of these facts. He's been busy on X promoting new features in Grok, his AI service intended to compete with OpenAI. Musk's most recent innovation there is Companions, a free-to-try service in-app that will cost SuperGrok subscribers $30 per month for the full set of features. For now, users can check out Ani, a sexy blonde anime girl, or Rudi, a rowdy red panda. A third male avatar is coming soon. Musk promises that customizable companions are also coming soon, per a tweet from this morning. Related: Tesla finally came through on a big Elon Musk promise The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Miami Herald
10 hours ago
- Business
- Miami Herald
Elon Musk's xAI pushes Grok into Palantir territory
Elon Musk's 2025 has been far from quiet. Starship explosions, robotaxi reveals, and Twitter wars with President Donald Trump have headlined Musk's chaotic year. Don't miss the move: Subscribe to TheStreet's free daily newsletter Yet, in the middle of the noise, Musk's AI brainchild in xAI continues moving like clockwork. Moreover, with the newest update, xAI's Grok could be angling to knock on the same high-security doors Palantir's been guarding for years. Image source: Smialowski/AFP via Getty Images Recent months have shown that xAI doesn't lack any ambition or capital. Since its hotly anticipated launch in March 2023, the company has built Colossus, a GPU supercluster that scaled from 100,000 to 200,000 Nvidia units in just 122 days. Now, it's aiming for a million, to position itself as the world's largest AI training platform. That's some serious flex in a market where compute capacity is critical in staying ahead. Musk has kept xAI separate from Tesla, though he's alluded to a future shareholder vote on deeper investment. The great thing is that the strategy is clear with xAI. Related: Elon Musk's xAI is already shockingly massive A key focus for the AI upstart is to develop frontier large language model (LLM) development across government, defense, and commercial domains. At the same time, the goal is to seamlessly embed Grok into Tesla cars and Optimus humanoid robots for edge deployment. The funding numbers are just incredible. xAI recently secured $10 billion, split evenly between a $5 billion equity raise and a $5 billion debt package arranged by Morgan Stanley. That round took its meteoric valuation to $113 billion, thanks in part to a $2 billion boost from SpaceX. Now, talks suggest a new raise that could take its value to between $170 billion and $200 billion. More Tech Stock News: Cathie Wood drops bold message on Apple, Tesla stockGoogle Brain founder has an unexpected one-word message on AIUnsung AI stock pops after joining S&P 500 That's a monstrous jump from early estimates of $33 billion to $80 billion. Some call it hype. Others say it's the price of building the most potent AI infrastructure at scale. Elon Musk's xAI is taking things up a notch with his government work, and not quietly. Just days after the Grok 4 reveal, Musk has now "Grok for Government," a customized suite of AI tools for federal, state, and local agencies. The move signals Musk's intent to jump into the high-stakes defense-grade AI world. The announcement comes with some real muscle. xAI secured a massive new Department of Defense contract with a $200 million ceiling, standing alongside tech giants like Google, OpenAI, and Anthropic. While that sum is relatively modest next to bigger contracts, it's a powerful entry point for a company still in its nascence. "Supporting the critical missions of the United States Government is a key part of this mission," xAI said in a statement. Related: JPMorgan reveals 9 stocks with major problems The Department's Chief Digital and AI Officer Doug Matty echoed that urgency, saying the government must adopt commercial AI tools in warfighting and intelligence efforts. For Musk, it's more than a business deal. Grok's powerful future is linked closely to Tesla's broader ecosystem, and this unusual overlap puts Musk's fingerprints all over the next generation of U.S. AI capabilities. Could this be a direct challenge to Palantir? More importantly, though, the arrival of Grok for Government can effectively take xAI in direct competition with Palantir. Palantir has effectively become the U.S. government's go-to name in mission-critical analytics. It pulled in a whopping $1.2 billion from U.S. government contracts in 2024, a robust 30% jump YOY, with deep roots in defense and intelligence through its Gotham and Foundry platforms. However, where Palantir leans on Big Data fusion and tailor-made deployments, Grok offers greater agility. xAI's tools could potentially offer faster rollouts and flexible API integrations. Early signs of traction have already been emerging, with reports that the General Services Administration is exploring Grok, pointing to stronger civilian agency adoption. If Grok could match or beat Palantir on speed, cost, or ease of use, we could see Musk's name plastered on more than just SpaceX rockets and EVs. With AI looking to reshape military logistics and fraud detection, the real battle may be over who defines the next phase of American power. Related: Moody's drops 2-word warning on housing market The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Business Insider
21 hours ago
- Automotive
- Business Insider
Tesla Stock (TSLA) Stalls on Fears That Head of North American Sales is Latest Leader to Quit
Tesla (TSLA) stock dropped today on a report that its top sales executive in North America, Troy Jones, has left the company. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. The Wall Street Journal reported that Jones had become the latest senior departure at the bedraggled business. The vice president of sales, service and delivery in North America – Tesla's biggest market – Jones has been with the company for 15 years. Series of Departures The EV maker, led by chief executive Elon Musk, has seen a number of recent departures since early last year. That includes key figures like Musk's confidant, Omead Afshar, chief battery engineer Drew Baglino and global public policy head Rohan Patel. The head of Tesla's Optimus humanoid robot team, Milan Kovac, announced he was leaving in June, and top battery executive Vineet Mehta did so in May. Their departures, along with others in legal and supply chain leadership, have raised questions about internal stability at the company as it navigates a sales slump and a shift to robotics and self-driving technology. Indeed, corporate governance is one of the clear risks investors need to be aware of. The group, whose stock price has slumped 22% since the start of the year, has also been plagued by falling sales and criticism over its dull designs compared to rivals such as China's BYD (BYDDY). Battered Business It has also been battered by the on and then off political relationship between Musk and President Trump. His role as head of the Department of Government Efficiency dented the brand's reputation with certain customers, with investors worried about the amount of time he spent away from the day job of running Tesla. There were also concerns about Musk's often erratic behavior in the Oval Office. When he left his government role it was hoped that the Tesla focus would return, but he is now intent on setting up his own political party to rival Trump. Perhaps it will be Musk who is the next to leave the driving seat with some rumblings that perhaps it is time for a new Tesla leader to step forward. Is TSLA a Good Stock to Buy Now? On TipRanks, TSLA has a Hold consensus based on 13 Buy, 13 Hold and 9 Sell ratings. Its highest price target is $500. TSLA stock's consensus price target is $293.38 implying a 6.52% downside.
Business Insider
a day ago
- Automotive
- Business Insider
UBS Calls Tesla (TSLA) Overvalued Ahead of Q2 Earnings, Maintains $215 Price Target
Tesla (TSLA) is set to report Q2 earnings on July 23, and UBS remains bearish. In a Monday note, analysts reiterated a 'Sell' rating with a $215 price target, calling the stock 'fundamentally overvalued' despite a likely sector-wide beat driven by stronger production and FX tailwinds. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. UBS expects Tesla's earnings per share to come in at $0.43. Auto gross margins, excluding regulatory credits, are forecast at 14% versus the Street's 13.5% consensus. The firm acknowledged that margins may surprise on the upside following Tesla's delivery beat, but underlying valuation concerns persist. Tesla closed Monday at just under $317, up 1%, but shares remain down over 21% year-to-date. UBS Sees Regulatory Uncertainty A key issue for UBS is the loss of high-margin regulatory credit revenue. The firm warned of risks tied to the removal of EV tax credits and flagged regulatory uncertainty for both Tesla and Rivian (RIVN). Additionally, UBS cited demand pressures, possible estimate downgrades, and concerns about CEO Elon Musk's focus following the recent robotaxi event. While Tesla's momentum is partly fueled by its narrative, UBS noted the stock's valuation has already re-rated by roughly 20% since March, and core business challenges remain. Updates on the long-delayed affordable model and commentary around U.S. policy changes could move the stock in the short term. Research company Visible Alpha's data shows sentiment split, with eight 'Buy,' five 'Hold,' and four 'Sell' ratings. UBS stands among the more skeptical voices, expecting the conference call to focus less on current car demand and more on forward-looking projects like robotaxis and the Optimus robot. Is Tesla a Buy, Sell, or Hold? On the Street, Tesla currently boasts a Hold consensus rating from Wall Street analysts based on 35 reviews. The average price target stands at $293.38, suggesting a potential downside of 7.42%.
Yahoo
a day ago
- Automotive
- Yahoo
Tesla Just Applied to Launch Robotaxis in Phoenix. Does That Strengthen the TSLA Stock Bull Case?
The last time I wrote about Tesla (TSLA), the electric automaker was finally ready to launch its robotaxi service in Austin. In the month since, a lot has happened in the world of Tesla and its CEO Elon Musk Then, the stock is down about 8% over that period, Musk has launched his own political party, told one of the biggest Tesla bulls to 'shut up' when he proposed some changes to the board, reported a sequential rise but yearly drop in vehicle deliveries, and opened its first showroom in India. Palantir Just Launched Warp Speed for Warships. Does That Make PLTR Stock a Buy? This Analyst Just Doubled His Price Target on AMD Stock How High Can Nvidia Stock Go as Jensen Huang Heads to China? Our exclusive Barchart Brief newsletter is your FREE midday guide to what's moving stocks, sectors, and investor sentiment - delivered right when you need the info most. Subscribe today! True to its character, Tesla has not stayed out of the headlines. And it looks like it will stay that way with the Elon Musk-led company looking to commence its robotaxi services in Phoenix, Arizona. With its Google (GOOGL)-backed rival Waymo already operating in the city, some analysts believe that Tesla's robotaxi expansion here is a positive development. So, as investors, is this the right time to invest in Tesla stock, which is already down about 23% on a YTD basis, or is now the time for caution? Let's find out. Investors with a long-term view should avoid all the noise around Tesla stock because the future of Tesla includes exciting bets such as full self-driving (FSD), Optimus humanoid robots, the Dojo supercomputer, and AI initiatives such as Grok 4. In terms of autonomy and FSD capabilities, Tesla stands apart largely due to its tightly controlled operations across every layer of development and deployment. What differentiates the company is its extensive vertical integration. While the likes of Waymo tend to rely on outside vendors and fragmented systems, Tesla operates differently. It designs its own AI chips and FSD software, produces its battery technology, and oversees its global network of charging infrastructure. This integrated approach results in greater design speed, stronger operating leverage, and enhanced scalability. The company's reliance on camera-based Tesla Vision lowers vehicle production costs to approximately $30,000, a sharp contrast to the estimated $100,000 required for vehicles equipped with LiDAR sensors. Though questions persist over safety trade-offs, the cost advantage remains evident. Tesla's position in emerging technology is also reinforced by Elon Musk's broader portfolio. Despite recent challenges related to Starship launches, SpaceX remains focused on long-term plans around interplanetary travel. Meanwhile, xAI is reportedly on track for a capital raise that could place its valuation north of $200 billion, reflecting optimism around its AI roadmap and expanding ecosystem. However, not all developments are favorable. Tesla faces real pressure from rising competition, especially from newer entrants in China. BYD (BYDDY) continues to scale aggressively, and now Xiaomi (XIACY) has also seriously entered the fray with the YU7, which garnered over 200,000 preorders shortly after launch. Meanwhile, in Q2 2025, Tesla delivered 384,122 vehicles, 14% lower year over year. Further uncertainty surrounds Elon Musk's 'extracurricular activities' in the form of his politics. His relationship with former ally President Donald Trump has come under strain, most notably due to disagreement over Trump's tax-and-spending bill. A key provision of this bill removes the federal tax credit of $7,500 on electric vehicles, undermining Tesla's pricing advantage at a time when the company is already contending with stiff global competition. No immediate support appears forthcoming from either the European or Chinese markets, compounding concerns around Tesla's near-term outlook. Although there have been issues with Tesla's financial performance in recent quarters, it is still in a good place. However, the recently released results for the first quarter of 2025 fell short of expectations. While this underperformance may raise some concerns, it remains consistent with the growing pains of a company investing deeply in transformative technologies with long-term ambitions. For the quarter, Tesla recorded total revenue of $19.3 billion, representing a 9% decline compared to the same period a year earlier. The automotive division, which is the backbone of the company's operations, faced considerable pressure, with revenue sliding 20% to $13.9 billion. The firm's ancillary units delivered stronger performances. Energy generation revenue rose sharply by 67%, while the services division posted a 15% gain, reaching $2.7 billion and $2.6 billion, respectively. Profitability took a notable hit in the period. Earnings per share declined to $0.27, marking a steep 40% drop year-over-year and significantly missing the consensus estimate of $0.41. This shortfall primarily stemmed from a rise in input costs and a broader deceleration in the delivery of vehicles. Even so, the company displayed considerable improvement in its cash generation capabilities. Operating cash flow for the quarter climbed to $2.2 billion, a substantial improvement from the $242 million reported in the comparable period last year. Free cash flow also returned to positive territory, registering $664 million after the prior year's outflow of $2.5 billion. Tesla ended the quarter with a strong liquidity position, holding $37 billion in cash and equivalents. Taking all of this into context, the analyst community has assigned a rating of 'Hold' for Tesla stock, with a mean target price of $296.83, which has already been surpassed. However, the high target price of $500 implies upside potential of about 60% from current levels. Out of 40 analysts covering the stock, 12 have a 'Strong Buy' rating, two have a 'Moderate Buy' rating, 16 have a 'Hold' rating, and 10 have a 'Strong Sell' rating. On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Sign in to access your portfolio
