Advertising
For premium support please call:
Ross Gerber, CEO and President, Gerber Kawasaki Wealth
When asked about Elon’s resolve to get more Array, Gerber exclaimed: “The index budget owns 30% of Tesla. They don’t vote anything. Elon owns 13%. You know what I’m saying? Nobody can take away from Tesla. ” There is no one there. It would take many, many billions of dollars in money to buy the shares. So the concept that he’s not Tesla. . . Tesla is the closest thing to a personal corporation that a public corporation is. Very good ? It does not work like ordinary state-owned companies. Come on. “
For more information and the latest market actions, click here to watch this full episode of Yahoo Finance Live.
Tesla (TSLA) CEO Elon Musk warned Monday that he will want to out-insure Tesla if the company’s long-range AI ambitions are to be met.
“I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control. Enough to be influential, but not so much that I can’t be overturned,” Musk said from his X account on Monday night. “Unless that is the case, I would prefer to build products outside of Tesla.”
Musk went on to say that large asset custodians such as Fidelity and BlackRock own stakes in Tesla similar to his and asked: “Why don’t they show up for work?”
Aside from Musk’s comparison, Tesla has ambitious AI goals, and the company employs its Dojo supercomputer to exercise the style of AI that powers its Full Self Driving (FSD) software, among other initiatives.
Wall Street analysts have claimed that Tesla’s supercomputer and artificial intelligence products can bring good luck to Amazon’s AWS cloud services, which can be a huge non-automotive profit generator for Tesla.
Musk used to have a much larger stake in Tesla but he sold a large quantity of Tesla stock to fund his widely criticized purchase of Twitter — now X — in 2022, diluting his Tesla stake to 13% from around 22%. Wall Street initially reacted negatively to Musk’s tweet with the stock down over 2% in early trading on Tuesday; near 10:15 a.m. ET, however, shares had reversed and were up more than 1%.
Tesla stock has lost nearly $100 billion in market cap since the start of this year, and Musk’s foray into basically asking for more shares in new compensation, or changing direction on AI, is giving investors pause.
“This is no secret and is key to our bullish thesis that all AI projects deserve to stay within Tesla, from Dojo to Optimus, FSD, robotaxi and other advances in robotics,” Wedbush analyst Dan Ives wrote in a note to investors.
“The Street rightly sees (in our view) Tesla as a disruptive generation leader, and if Musk were, after all, to go down the path of building his own company (separate from Tesla) for his next-generation AI projects, it would obviously be a huge negative for Tesla’s history. “
Ives wrote that a new refund schedule for Musk has most likely been delayed while ongoing litigation over Musk’s previous refund moves through the courts. The plaintiff shareholders argued that Elon Musk’s previous salary was higher and represented a portion of the company’s resources.
The other main factor that emerges from Musk’s call to increase inventory is the negative outward appearance and belief that a CEO demands more than a company (and necessarily more compensation) when he or she deserves to have the most productive interests of shareholders in mind.
Tesla’s board of directors has also been criticized in the past for being too comfortable with Musk and for being full of Musk supporters, adding his brother Kimbal Musk and others who jointly invest in Musk’s corporations such as SpaceXArray.
Musk has argued that he would be okay with a two-tier voting design if it meant getting more control, rather than more compensation, but admits that converting Tesla’s elegance-level percentage design is rarely imaginable given Delaware’s corporate law, which governs Tesla.
Other voices on Wall Street have been more direct, arguing that Musk is out of his element.
“That’s not how corporate governance works,” Third Point founder and activist hedge fund manager Dan Loeb fired back in response to Musk on X.
Pras Subramanian is a journalist for Yahoo Finance. You can see him on Twitter and Instagram.
Click here for the latest stock news and an in-depth analysis of the events that move stocks.
Read the latest monetary and trade news from Yahoo Finance
Advertising
Advertising
Ad
Advertising
Advertising
Advertising
Advertising
Advertisement
Advertising
Advertising
Ad