(Jim Watson/Getty Images)

Tesla falls sharply after Musk and Trump feud gets nasty

The souring of their relationship will likely have a real impact for Tesla’s bottom line, given how much of the company’s business is related to federal credits.

J. Edward Moreno

6/5/25 2:09PM

Tesla is down by double digits after CEO Elon Musk and President Trump had a very public falling out that started off as a budget dispute and escalated to a threat to pull the entrepreneur’s government contracts, marking what appears to be the end of a relationship between the leader of the free world and the world’s richest man.

Musk took issue with the government spending bill the president backed, which the entrepreneur said would add to the government’s debt and undercut the mission he was given to help reduce government spending. The bill also axes the federal EV tax credit for customers, which could dampen demand for Tesla and jeopardizes its revenue from selling regulatory credits, without which Tesla would have posted a loss last quarter.

On Thursday in the Oval Office, Trump responded by saying he’s “very disappointed in Elon.”

“I’ve helped Elon a lot,” he said.

That’s when Tesla began to slip. As the spat escalated, it started to bringing other Trump trades down with it. So far, the dispute has destroyed well over a hundred billion dollars in market value for Tesla alone.

Trump: I'm very disappointed in Elon. I've helped Elon a lot. pic.twitter.com/jE49UtcBUU
— Acyn (@Acyn) June 5, 2025

Musk spent a small fortune of his personal wealth getting Trump elected. He responded on X that without him, “Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate.”

Such ingratitude
— Elon Musk (@elonmusk) June 5, 2025

Then the gloves came off.

Musk, 54, later (ominously) pointed out that Trump, 78, has 3.5 years left as president “but I will be around for 40+ years…”

Then Trump hit him where it hurts. On Truth Social, Trump said the easiest way to save money in the bill would be to cut the many government contracts and subsidies that Musk’s businesses benefit from. In addition to the EV tax credits that have made Teslas more affordable for some, SpaceX counts the US government as one of its largest customers. Musk then alleged that Trump is in the Epstein files.

After Trump was elected, Tesla shares rose as investors banked that Musk’s cozy relationship with the president would benefit the company. But without that relationship, what’s left are policies that mostly hurt Tesla, like tariffs and cutting the EV tax credit. In fact, analysts at JPMorgan estimated the budget bill alone would cut Tesla’s profits in half.

What a ride. At first, Tesla’s relationship with the president was great for the stock. Then the company realized Democrats buy cars, too, and Europeans and other foreign markets didn’t like his political stances. Now, the breakup is hurting.

Luke Kawa

Qualcomm spikes despite poor forecast, citing progress with “leading hyperscaler” and an imminent return to growth in China

Qualcomm, a chip company seemingly left behind in AI, is trying to lean in more to the boom.

A crowd of visitors at the Qualcomm ( Qualcomm is an...

Max Knoblauch10h

Ford raises its full-year guidance, receives $1.3 billion tariff refund

Ford reported its first-quarter results after markets closed on Wednesday. The automaker’s shares climbed roughly 7% in after-hours trading on the news.

For Q1, Ford reported:

Adjusted earnings of $0.66 per share, compared to the $0.18 per share expected by Wall Street analysts polled by FactSet. The figure includes Ford’s tariff reimbursement.
$43.25 in total revenue, vs. the $42.66 billion consensus forecast. Automotive revenue came in at $39.8 billion, compared to estimates of $38.9 billion.
A $1.3 billion tariff refund.

Ford boosted its full-year guidance for adjusted earnings before interest and taxes to between $8.5 billion and $10.5 billion, up from between $8 billion and $10 billion.

Late last year, Ford announced it would take $19.5 billion in charges — one of the largest write-downs ever — relating mostly to its EV business. Of those charges, $7 billion will be spread across this year and next, the company said.

Earlier this month, Ford recorded an 8.8% drop in Q1 sales from the same period last year, a similar result to Detroit rival GM, which posted a 9.7% sales drop.

Jon Keegan10h

Microsoft beats on revenue and earnings in Q3, but only meets expectations for cloud growth

Microsoft shares dipped after the company reported strong Q3 earnings postmarket Wednesday, posting sales of $82.9 billion for the quarter, beating FactSet analyst estimates of $81.4 billion. Earnings per share were $4.27, handily beating estimates of $4.05.

In a closely watched number, Microsoft’s Azure cloud business increased 40% year on year, just above the 39.7% estimated. The metric technically beat expectations, but may not be the beat investors were looking for.

Total capital expenditure for the quarter was $31.9 billion, up 49% year on year, above estimates of $27.5 billion and down from Q2’s $37.5 billion.

One thing investors were eager to find out: how is the company doing in its effort to fulfill the billions in backlogged commercial bookings? Last quarter, the company reported a staggering $625 billion in remaining performance obligations, and 45% of that was for just one customer — OpenAI.

For the third quarter, Microsoft reported a backlog of $627 billion, up 99% year on year. The company said the RPO increase was 26% — in line with “historical seasonality” — when excluding OpenAI.

Breaking down the results by the company’s business lines:

☁️ 🤖 Intelligent Cloud (Azure, server products): $34.7 billion in revenue, up 30% year on year.
📝 📊 Productivity and Business Processes (Microsoft 365, LinkedIn, Dynamics): $35 billion in revenue, up 17% year on year.
💻 🎮 More Personal Computing (Windows, Xbox, Bing): $13.2 billion in revenue, down 1% year on year.

Microsoft CFO Amy Hood said in the earnings release:

“We delivered results that exceeded expectations across revenue, operating income, and earnings per share, reflecting strong execution and growing demand for the Microsoft Cloud.”

Max Knoblauch

10h

Carvana reports better-than-expected Q1 sales, gross profit per vehicle

Carvana reported its first-quarter earnings after markets closed on Wednesday.