Tesla Stock Gains As Musk Plans DOGE Cutback, Despite Weak Q1

(RTTNews) - Shares of Tesla, Inc. were gaining around 7 percent in the pre-market hours on the Nasdaq, continuing an upbeat activity on Tuesday's after-hours, after CEO Elon Musk announced that he will reduce time with President Donald Trump's Department of Government Efficiency or DOGE significantly, starting in May.

The announcement on the luxury electric vehicle maker's earnings call came after reporting disappointing first-quarter profit and revenues with weak volume.

On the Nasdaq, Tesla stock moved 5.4 percent higher in the extended trading on Tuesday after closing the regular trade 4.6 percent higher. The stock is currently gaining 7.2 percent in the pre-market activity, at $255.00. Tesla's stock price had plunged more than 40 percent this year.

On the earnings call, Musk, a supporter of Trump and a prominent public face of the DOGE initiative, stated that with the major work of establishing the DOGE is done, and he plans to allocate probably more time to Tesla, starting next month.

He added that he will continue to be associated with the DOGE team probably the remainder of the President's term to make sure that the waste and fraud the team is eradicating is not returning back.

Musk plans to continue to spend a day or two per week on government matters for as long as the President asks and as long as it is useful.

"As some people know, there's been some blowback for the time that I've been spending in government with the Department of Government Efficiency or DOGE. I think the work that we're doing there is actually very important for trying to sprain in the insane deficit that is leading our country, the United States, to destruction. And the DOGE team has made a lot of progress in addressing waste and fraud. The natural blowback from that is those who were receiving the wasteful dollars and the fortunate dollars will try to attack me and DOGE team and anything associated with me," he noted.

Musk had spent almost $300 million in the 2024 campaign to help Trump return to the White House. He was appointed as special government employee, who then created DOGE with a view to cut down the size and unwanted expenses of the federal government.

DOGE's website currently shows that the cuts have resulted in an estimated $160 billion in savings.

Meanwhile, Musk's ties to Trump had affected Tesla significantly with severe protests and brand damage. It's stock also fell sharply since Trump took office.

However, Musk in the earnings call called those protests as very organized, claiming that some people are likely protesting because they're receiving fraudulent money or are recipients of wasteful largesse.

In its first quarter, Tesla's profit decreased 71 percent from last year and missed the Street estimates.

The company's earnings came in at $409 million or $0.12 per share, sharply lower than last year's $1.390 billion or $0.41 per share.

Adjusted earnings were $934 million or $0.27 per share for the period. Analysts on average had expected the company to earn $0.42 per share. Analysts' estimates typically exclude special items.

The company's revenue for the period fell 9.2 percent to $19.335 billion from $21.301 billion last year with a decline in vehicle deliveries.

Total automotive revenues declined 20 percent from last year to $13.97 billion.

In the quarter, total production dropped 16 percent to 362,615 units, and total deliveries fell 13 percent to 336,681 units.