Charged: Tesla reports disappointing quarterly results

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From the hotly-debated high-flier Tesla (TSLA), Wall Street’s newest darling Rivian (RIVN), traditional-stalwarts turned EV-upstarts GM (GM) and Ford (F) to the numerous SPAC-deal makers that have come public in this red-hot space, The Fly has you covered with “Charged,” a weekly recap of the top stories and expert calls in the sector.

RESULTS: On April 22, Tesla reported weaker-than-expected quarterly results, with Q1 adjusted EPS coming at 27c and revenue at $19.34B, both below consensus of 42c and $21.41B, respectively. The company also said it will revisit 2025 guidance in Q2 update. “It is difficult to measure the impacts of shifting global trade policy on the automotive and energy supply chains, our cost structure and demand for durable goods and related services. While we are making prudent investments that will set up both our vehicle and energy businesses for growth, the rate of growth this year will depend on a variety of factors, including the rate of acceleration of our autonomy efforts, production ramp at our factories and the broader macroeconomic environment. We will revisit our 2025 guidance in our Q2 update.” 

Tesla added, “We have sufficient liquidity to fund our product roadmap, long-term capacity expansion plans and other expenses. Furthermore, we will manage the business such that we maintain a strong balance sheet during this uncertain period. While we continue to execute on innovations to reduce the cost of manufacturing and operations, over time, we expect our hardware-related profits to be accompanied by an acceleration of AI, software and fleet-based profits.”

During the company’s earnings conference call, CEO Musk said his time allocation to DOGE will “drop significantly” in May. Several Wall Street analysts lowered their price targets on the stock following quarterly earnings. 

TESLA ROBOTS: Tesla CEO Elon Musk said China’s halt on exports of certain magnets is impacting his plans to build humanoid robots, Keith Bradsher of The New York Times reported. China produces the entire world’s supply of heavy rare earth metals and 90% of magnets made with these metals. During Tesla’s earnings call, Musk said, “That’s more affected by the supply chain, by basically China requiring an export license to send out anywhere with magnets, so we’re working through that with China.” The Fly notes that companies involved in the development and mining of rare earth minerals include Nova Minerals (NVA), Ioneer (IONR), Lynas Rare Earths (LYSCF), MP Materials (MP), Energy Fuels (UUUU), NioCorp (NB) and VanEck Vectors Rare Earth/Strategic Metals ETF (REMX). 

SELF-DRIVING RULES: The NHTSA plans to ease rules for autonomous vehicles, including loosening crash reporting requirements and simplifying approvals, in changes championed by Tesla CEO Elon Musk, The Financial Times’ Stephen Morris and Kana Inagaki report. “This administration understands that we’re in a race with China to out-innovate, and the stakes couldn’t be higher,” US transportation secretary Sean Duffy said on Thursday. “Our new framework will slash red tape and move us closer to a single national standard that spurs innovation and prioritizes safety.” Other publicly traded companies in the EV space include Ford, GM, Rivian, Lucid (LCID), Nio (NIO), Xpeng (XPEV), Li Auto (LI), Nikola (NKLA), and Zeekr (ZK). 

Click here to check out Tesla’s recent Media Buzz Sentiment as measured by TipRanks.

30-DAY CATALYST WATCH: Citi added an “upside 30-day catalyst watch” on shares of Nio, while keeping a Buy rating on the name with an $8.10 price target. The firm cites the company’s new model launches, new advanced driver assistance systems chips, and cost savings for the catalyst watch. Citi expects Nio may potentially deliver 63,000 units, or 50% quarter-over-quarter growth, in Q2.

DONE GOING DOWN: Northland upgraded SolarEdge (SEDG) to Market Perform from Underperform with a price target of $12.50, down from $15. Shares have declined significantly since the firm cut the stock to Underperform late in February, notes the firm, which estimates that SolarEdge will exit calendar year 2025 with about $350M in net cash and doesn’t expect the company to file for bankruptcy. Though Northland says it is not encouraging investors to accumulate shares at current levels, it believes the shares “are done going down.”

SELL SOLAREDGE: Guggenheim downgraded SolarEdge to Sell from Neutral with a $5 price target. Comments from competitor Enphase Energy (ENPH) regarding the company’s business outlook in the U.S. and Europe signal additional challenges for SolarEdge, says the firm, which also believes that consensus expectations for 2026 are “significantly too high.” Guggenheim has believed for a while that SolarEdge’s hopes for a recovery in the European residential solar market are “unreasonable” considering the level of competitive pressure from Chinese firms. 

Morgan Stanley also downgraded SolarEdge to Underweight from Equal Weight with a price target of $10, down from $18. The firm cites worsening end market demand, potential negative impacts to earnings from tariffs, and the company’s heightened exposure to potential changes to the Inflation Reduction Act for the downgrade. Additionally, SolarEdge’s “tight” liquidity position and upcoming debt maturity “requires near-perfect execution,” which is a “considerable risk given the current environment,” Morgan Stanley tells investors in a research note.

SOLAR TARIFFS: The U.S. set new duties as high as 3,521% on solar imports from four Southeast Asian countries, reported Bloomberg’s Mark Chediak and Jennifer Dlouhy. A year-long trade probe that found solar manufacturers in Cambodia, Vietnam, Malaysia and Thailand were unfairly benefiting from government subsidies and selling exports to the US at rates lower than the cost of production, the report noted. 

Citi says the U.S. Department of Commerce concluded its anti-dumping and countervailing duties investigation of crystalline photovoltaics cell imports from four Southeast countries with “sharply higher” rates compared to the preliminary determination. Final combined rates for Cambodia, Malaysia, Thailand, and Vietnam are 652%, 34%, 375%, and 396%, respectively, the firm tells investors in a research note. Citi believes the duties are negative for the entire solar sector except for First Solar (FSLR). Potential duties on anode material imports from China expected in May could be incrementally negative for Fluence Energy (FLNC), Enphase Energy, SolarEdge, and Sunrun (RUN), contends Citi. The firm views the final rulings as broadly negative, particularly for Canadian Solar (CSIQ). First Solar is the “clear winner” due to its domestic footprint and “differentiated” technology that is not exposed to anti-dumping and countervailing duties, says Citi.