Morristown, New Jersey — Tesla’s stock remained relatively stable Thursday morning after the company refuted claims that its board was seeking a new chief executive to replace Elon Musk. The Wall Street Journal reported, citing unnamed sources, that Tesla’s board had engaged executive search firms in pursuit of potential CEO candidates. Initially responding to the report, Tesla’s shares fell nearly 3% in after-hours trading before regaining some ground.
Tesla Chair Robyn Denholm took to social media to reject the allegations, stating the report was “absolutely false.” Denholm emphasized that the board had not initiated any process for a CEO search and expressed confidence in Musk’s ability to lead the company. She noted that the CEO position remains firmly held by Musk, who is expected to continue steering Tesla through its growth trajectory.
This denial comes amidst a challenging period for the electric vehicle manufacturer, which recently reported disappointing sales and earnings figures that did not meet market expectations. Musk acknowledged during a recent earnings call that his involvement in governmental affairs since joining the Trump administration may be impacting the company’s stock performance.
In its first quarter results, Tesla disclosed a 9% decline in total revenue, bringing in $19.34 billion, which fell short of analysts’ projections of $21.11 billion. The automotive division experienced a staggering 20% drop in revenue to $14 billion, driven partly by the need for upgrades in its production lines to prepare for a refreshed version of its Model Y SUV. The company also highlighted lower average selling prices and increased sales incentives as factors contributing to the revenue decline.
Net income for the quarter dropped sharply by 71%, registering at $409 million, or 12 cents per share, compared to $1.39 billion, or 41 cents per share, during the same quarter a year ago. This downturn has contributed to a steep decline in Tesla’s stock price, which has plummeted more than 30% since the beginning of the year.
As Tesla navigates these financial hurdles, Musk’s focus on his upcoming role in the Department of Government Efficiency—where he plans to dedicate only “a day or two per week” beginning in May—has raised concerns among investors. The challenge for Tesla will be to regain momentum in a competitive electric vehicle market while addressing the pressures that have emerged from both financial results and leadership speculation.