4 Key Takeaways Elon Musk Remarks Tesla Earnings Call

Tesla's CEO Elon Musk discussed investor concerns about profitability, AI, humanoid robots, and Cybertruck deliveries in the fourth-quarter earnings call.

Tesla's recent fourth-quarter earnings were a bit of a disappointment, falling short of analyst estimates. CEO Elon Musk addressed investor concerns on the company's earnings call, discussing profitability, voting control, and the impact of high-interest rates on consumer spending. Musk noted that if interest rates come down quickly, margins will be good, but if not, they wouldn't be as strong.

Reduced vehicle prices in the fourth quarter dragged down Tesla's revenue, as macroeconomic conditions like high interest rates affected consumer spending. The auto industry as a whole offered discounts on vehicles, with Tesla's average sale price dropping by 25% in December compared to the previous year. The Fed has signaled that rate cuts are expected in the second half of 2024.

Musk emphasized that it's not that people don't want to buy Tesla vehicles, but they simply cannot afford them in a high-interest-rate environment. He also expressed his desire for strong influence, but not control, of Tesla before ramping up AI initiatives.

Musk has been vocal about wanting 25% voting control of the company before advancing Tesla's position in the AI race. He is concerned about being voted out by some random shareholder advisory firm without more influence. He believes that 25% control is enough to have a strong influence without being able to control the company entirely.

Tesla's humanoid robot, Optimus, has been in the works since 2022 and uses AI technology similar to that of the company's self-driving cars. Musk expressed optimism about the potential of the robot, calling it the "most valuable product of any kind, ever." However, he also acknowledged the uncertainty surrounding the new product and promised to update the public on its progress.

As for the Cybertruck, Musk stated that delivery issues are due to production constraints, not a lack of demand. While the company could raise the price to address high demand and low supply, he doesn't feel it's the right approach. Tesla expects to deliver around 250,000 Cybertrucks annually in North America.

Overall, Musk's comments shed light on Tesla's challenges and opportunities, providing insight into the company's future plans and strategies.