Home Automotive Musk promised Tesla would benefit from his Twitter misadventure, but Wall Street is worried

Musk promised Tesla would benefit from his Twitter misadventure, but Wall Street is worried

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  • An SEC filing on Wednesday revealed that Elon Musk sold an extra $3.6 billion in Tesla shares.
  • Analysts speculate that the earnings will help make up Twitter’s losses, raising concerns.
  • Dan Ives said Musk is “using Tesla as his ATM machine” to fund Twitter.

The implications for Tesla of Elon Musk’s acquisition of Twitter have become increasingly terrifying for investors. For the third time in April after he said he hadNo more TSLA sales plannedMusk sold 22 million shares of Tesla stock for a value of about $3.6 billion, according to documents filed Wednesday. That brings the total amount of Tesla stock Musk has sold this year to his $23 billion.

just a few days ago, the mask promised In the long run, Tesla will benefit from his ownership of Twitter. But there is growing skepticism among analysts that it will happen. Wedbush’s Dan Ives reported Thursday that Musk’s Twitter remains a nightmare for investors as Musk “continues to fund his social network, using Tesla as his ATM machine.” It says there is.

With countries around the world facing their own recessions as the pandemic continues to emerge, it’s not necessarily a shock that Tesla’s electric car sales are declining. But it poses problems for Tesla and its owners. Tesla continues to fund Twitter mods for his venture to build an “everything app” he refers to under the name “X.”

Ultimately, Elon promised Tesla shareholders that he would profit from Twitter. He also promised not to sell any more Tesla stock. Whether or not he keeps his word is up to Tesla investors.

“Elon is Tesla’s brand. He needs to get it together,” said Loup Ventures. Gene Munster told Insider earlier this weekSome, like Tesla’s major shareholder Coguan Leo, have even suggested that Musk “abandoned” his duties at Tesla. called a new CEO to replace him.

Meanwhile, Insider reported on a series of issues on Twitter, including: Inactive Advertisers on the platform; Elon’s Reimagined Twitter Blue Failure; growing Concerns about rising prejudice on the platform; and Elon’s nasty political tweets That seems to add to the constant whirlwind of controversy surrounding the company.

In a memo to clients, Ives maintains Tesla’s excellent reputation, saying Tesla’s profitability outperforms its peers despite signs that Tesla isn’t the best performer in the batch. It shows what you expect.

Munster also warned that Elon’s inaction on the number of problems caused by the billionaire’s acquisition of Twitter would do long-term damage.

The wider market is also concerned. Since Musk bought his Twitter at the end of October, Tesla’s stock has fallen 31%. Since Musk made his offer to buy Twitter in mid-April, its stock has fallen 52%. It should be noted that tech stocks have lost trillions of dollars in value this year due to lower consumer demand, inflation and an overall market correction from the astronomical multiples seen in the previous year.

Tesla faces problems beyond Musk’s Twitter problems. The company is no longer a major electric vehicle manufacturer in several countries.Since the new entrant carved out its own market share and the traditional automaker’s successful launch of a series of hybrids and its own EV model, Tesla has Increased competition in the US, China and parts of Europe.

Bloomberg reported earlier this month that Tesla was cutting parts of the company. 20% increase in production in China Reached 30%. This shows that sales reality has not reached what was predicted. It is also reported that EV makers have cut the cost of cars in China to boost sales. It worked, but Tesla ultimately lost out to his Chinese competitor, BYD.

“More activism and growing investor discontent will soon force Tesla’s board to face some of these issues head-on. This is a moment of truth for Musk and Tesla. ’” writes Ives.

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