Tesla’s chief executive Elon Musk said he will be pulled back from his role in the so-called “Government Efficiency Ministry” that begins in May. Musk’s remarks came when he reported a massive DIP in both profit and revenue in the first quarter of 2025 amid a backlash against his role in the White House.
On investors’ phone calls, Musk said the government’s “mostly doing an orderly financial house” work is being done.”
“I’m sure my time allocation for Doge will drop significantly next month, May,” he said.
That said, he hopes to spend a day or two a week and continue what he calls “critical work” as “as long as the president wants me to do so, as long as it’s useful.”
Musk is scheduled to leave Doge on May 30th. This is a strict 130-day cap of his services as a special government employee.
Tesla saw a 9% year-on-year decline in revenue in the first quarter of 2025. The company generated revenue of $19.3 billion, well below Wall Street’s forecast of $21.45 billion. The company reported earnings per share of 27 cents, but it is well below expectations of investors with earnings per share of 43 cents.
Tesla’s profits slipped in $499 million by 71%, removing 71% from $1.399 billion in net income for the previous year.
The company saw a 13% drop in vehicle delivery, making its worst quarter since 2022. Tesla closed the quarter with delivery of 336,681 vehicles.
Musk admits that there are recent “rocky moments,” but he remains optimistic about the company’s future.
“Tesla’s future is better than ever,” he said. “The value of the company offers sustainable abundance for affordable AI-powered robots. If you say, the ideal future you can imagine is what you want. You want a wealth for everyone in a sustainable way. That’s good for the environment.
That “Happy Future” includes plans for a fully self-driving car company. The billionaire CEO said he laid out an ambitious timeline when he hopes cars will hit our roads in several cities “by the end of the year.” Tesla has it I had a hard time meeting historically Timeline masks are made public in the launch of new products, especially when it comes to autonomous driving.
“An acidity test allows you to wake up at your destination about sleeping in your car? I’m sure it will be available in many cities in the US by the end of this year,” he said.
This is on top of the Robotaxi service the company is planning to roll out in June. “We expect millions of Teslas to be fully autonomously active by the second half of next year,” Musk said.
The initial analyst’s response is optimistic given that many have significantly lowered their expectations after many reported massive DIPs in vehicle delivery despite lack of Wall Street expectations on top and bottom lines.
“On the backdrop of all the catastrophic expectations that we expect to continue to slump from the margins from sales, the lower numbers than Bad were received as welcome news from Tesla investors,” he said. Investing.com. “In the strange event, even at the worst moments, numbers seem to show that Elon and the team’s operations can still robust $19.3 billion in revenue, with gross revenues being partially compensated for a significant drop in car revenue.
“If this is the worst for Tesla, there must certainly be some advantage to the stock after a tailwind, such as the much-anticipated cheap model or Robotakshi.
Analysts attribute the company’s overall difficulties to the challenges, but ultimately concluded that Mask’s role in the White House caused a Tesla branding crisis. The company is at a major intersection, and according to analysts, it will only be corrected if Musk leaves his role in Doge and returns to Tesla as CEO full-time.
In addition to the decline in sales, which saw the stock fall 50%, existing Tesla owners are looking to sell their vehicles in large numbers. Teslas was destroyed nationwide, and in response to continued protests from the automaker, the Vancouver International Auto Show removed the electronic car maker from its March lineup. The company also recalls 46,000 cybertrucks. Almost everything was on sale.
Musk said the decline in demand was due to macro economic trends, not brands. “Tesla is not affected by macro demand for cars,” Musk said. “When there is economic uncertainty, people generally want to pause by making large capital purchases like cars. Without macro issues, we don’t see a decline in demand.”
The analysts aren’t sure.
“If Musk leaves the White House, there will be permanent brand damage… But Tesla brings back the most important assets and strategic thinkers as a full-time CEO to drive its vision, and the long-term story remains unchanged.” Wedbush remained bullish about the possibility that the company could turn its finances around. “If Musk chooses to stay in the Trump White House, it could change the future of Tesla/brand damage.”
The company refused to provide forward-looking guidance for the next quarter, citing “changes in global trade policies regarding automobile and energy supply chains.”
“We have made careful investments to set up both the vehicle and the energy business for growth, but this year’s growth rate will depend on a variety of factors, including the acceleration of autonomy efforts, production ramps at factories, and the broader macroeconomic environment,” the revenue report states. “We will revisit the 2025 guidance with the Q2 update.”
However, the company warned that “changes in political sentiment” could have a meaningful impact on the short-term demand for Tesla products.
