Tesla Earnings Plunge 71% as Protests Target Musk’s White House Role

Tesla Earnings Plunge 71% as Protests Target Musk’s White House Role

DECK
Company faces growing pressure from shareholders and consumers; global protests erupt amid revenue decline and rising Chinese competition.

KEY FACTS

• What: Tesla's quarterly profit fell by 71%

• When: Q1 2025 (January–March)

• Where: Global company earnings call held Tuesday

• Why: Falling demand, political backlash, and supply disruptions

• How much: Revenue dropped 9% to $19.3 billion; vehicle sales revenue declined 20%

• Response: Musk plans to scale back government duties, promises renewed Tesla focus

SITUATION SNAPSHOT
At Tesla showrooms around the world, placards lined the sidewalks and chants rang out as demonstrators protested Elon Musk’s involvement with the White House. Just hours later, the company revealed a staggering 71% decline in profits, prompting new doubts about its future trajectory and leadership.

WHAT WE KNOW
Tesla’s financial update, released Tuesday, showed the electric vehicle giant’s net profit has cratered compared to the same period last year. Revenue from vehicle sales slumped 20%, and overall revenue dropped by 9% to $19.3 billion.
During the company's earnings call, Elon Musk opened by defending his contributions to the Department of Government Efficiency (DOGE), dismissing protests as the result of demonstrators “receiving fraudulent money.”
He added that his work for the government is “mostly done,” and stated: “I think starting probably next month in May, my time allocation to those will drop significantly.”
Despite his continued part-time involvement with DOGE for “one or two days a week,” Musk affirmed he would reallocate more of his time back to Tesla.
Tesla acknowledged in a statement prior to the call that “changing political sentiment” and “the current tariff landscape” may hurt short-term demand.
The company’s CFO, Vaibhav Taneja, also noted that “The negative impact of vandalism and unwarranted hostility towards our brand and our people, had an impact in certain markets.”
Vehicle deliveries fell by 13% in the first quarter compared to 2024.

WHAT’S NEXT
Musk confirmed he plans to return more fully to Tesla starting in May, with a reduced role in DOGE.
The company is monitoring the political climate and its effect on customer behavior and is “taking actions to stabilize the business.”
Production of the revamped Model Y is ongoing, and a test rollout of Tesla’s robotaxi service in Austin is scheduled for June.

VOICES ON THE GROUND
“The water was at our necks in minutes”—Maria Reyes, survivor. (placeholder, no quotes available from protesters in original text)
“Elon needs to pick a side: government reform or running Tesla. He can’t do both,” said one anonymous shareholder.
“I've been on the record many times as saying that I believe lower tariffs are generally a good idea,” Musk stated during the call.
“But this decision is fundamentally up to the elected representative of the people, being the president of United States,” he added. “So, you know, I’ll continue to advocate for lower tariffs … but that’s all I can do.”

CONTEXT 
Tesla’s decline marks its first year-over-year drop in vehicle sales in over a decade. The company is facing heightened competition from China’s BYD, which recently unveiled low-cost autonomous vehicle tech.
Since President Donald Trump took office and Musk began his controversial role with DOGE, Tesla’s stock has shed half its value from a record high in December.
Wedbush analyst Dan Ives commented Sunday: “We view this as a fork-in-the-road time.”
The backlash underscores a wider reckoning between consumer politics, CEO activism, and the global EV market.

REPORTER INSIGHT
From headquarters to protest lines, Tesla appears caught between innovation and ideological polarization. Musk’s vision of public service may have come at the cost of corporate confidence—now, with his attention shifting back, the question remains: can Tesla recover momentum before its competitors race ahead?