Business
Tesla profit falls in the wake of brand controversy and tariffs
Tesla is off to a bumpy start this year.
The electric vehicle giant’s profit plunged 71% in the first quarter to $409 million as the company faced a flurry of setbacks, including looming tariffs and a brand crisis perpetuated by Chief Executive Elon Musk’s prominent role in the Trump administration.
The Austin, Texas-based company reported adjusted earnings per share of 27 cents, well below analysts’ expectations of 41 cents.
Revenue during the period dropped 9% from a year earlier to $19.3 billion.
Although it remains the world’s dominant automaker, Tesla has seen its stock plunge nearly 40% this year amid a decline in automotive sales and increasing competition from other electric vehicle manufacturers.
Tesla’s share price, which rose 4.6% on Wednesday to close at $237.97, has been subject to turbulence for months.
Shares rose after President Trump purchased a Model S on the White House lawn in March, but fell significantly in early April as investors became increasingly worried about a backlash against the Tesla brand.
The treasurers of eight states wrote an open letter to Tesla’s board of directors last week, voicing concern that “Tesla’s recent performance signals deeper governance and leadership challenges.”
The treasurers questioned Musk’s role in the so-called Department of Government Efficiency, or DOGE, and cited dropping share prices and vehicle delivery numbers.
Wedbush Securities analyst Dan Ives previously slashed his price target for Tesla shares by more than 40% to $315 from $550.
Driving Tesla’s woes is Musk’s deteriorating reputation, Ives said, which has led to protests and boycotts against Tesla and incidents of vandalism on Tesla vehicles and chargers.
Musk leads DOGE, which has made controversial cost cuts under Trump.
“Tesla has become a political symbol around the world and that’s not a good thing,” Ives said in an interview. “Musk needs to recommit to Tesla and officially take a step back from DOGE to do damage control.”
Tesla drivers who were once drawn to the environmental benefits of electric vehicles are growing embarrassed by their cars’ association with Musk, The Times has reported. Several celebrities have gotten rid of their Teslas as part of a public stand against the company.
Meanwhile, the vehicles’ falling resale value suggests a drop in demand, said Iseecars.com analyst Karl Brauer. In February, Tesla topped the list of brands that lost the most resale value year over year.
Although Musk has found himself securely in Trump’s corner, the president’s actions on tariffs pose a significant challenge for Tesla, which now faces a 25% tax on auto imports.
This month, Tesla suspended imports of crucial auto parts from China after Trump announced a 145% tariff on Chinese goods. Tesla had relied on China for components used to build its Cybercab, Musk’s budding robotaxi effort that has yet to hit public roads.
Musk unveiled the Cybercab in October and said Tesla’s autonomous driving technology would be ready for use in the near future. He has been touting the capabilities of the company’s Full Self-Driving mode for years, though the feature cannot be used without a human driver behind the wheel.
The decision to halt imports from China could disrupt plans to mass produce the Cybercab, which are vital to investor confidence in the company. Tesla will also stop importing Chinese parts for its electric semi truck.
Tesla said it produced 362,615 vehicles in the first quarter and delivered 336,681 vehicles. Deliveries fell 13% from last year. The company’s newest vehicle, the Cybertruck, has seen a falloff in sales.
In a quarterly webcast, Musk sought to allay investor worries, saying he would spend less time in Washington.
He painted a bright future for Tesla, citing the potential of autonomous driving and predicting that Optimus, Tesla’s humanoid robot, would lower labor costs and increase productivity.
“Tesla will be the most valuable company in the world by far but there will be a few bumps in the road before that happens,” Musk said on the call.
Business
Nike to Cut 1,400 Jobs as Part of Its Turnaround Plan
Nike is cutting about 1,400 jobs in its operations division, mostly from its technology department, the company said Thursday.
In a note to employees, Venkatesh Alagirisamy, the chief operating officer of Nike, said that management was nearly done reorganizing the business for its turnaround plan, and that the goal was to operate with “more speed, simplicity and precision.”
“This is not a new direction,” Mr. Alagirisamy told employees. “It is the next phase of the work already underway.”
Nike, the world’s largest sportswear company, is trying to recover after missteps led to a prolonged sales slump, in which the brand leaned into lifestyle products and away from performance shoes and apparel. Elliott Hill, the chief executive, has worked to realign the company around sports and speed up product development to create more breakthrough innovations.
In March, Nike told investors that it expected sales to fall this year, with growth in North America offset by poor performance in Asia, where the brand is struggling to rejuvenate sales in China. Executives said at the time that more volatility brought on by the war in the Middle East and rising oil prices might continue to affect its business.
The reorganization has involved cuts across many parts of the organization, including at its headquarters in Beaverton, Ore. Nike slashed some corporate staff last year and eliminated nearly 800 jobs at distribution centers in January.
“You never want to have to go through any sort of layoffs, but to re-center the company, we’re doing some of that,” Mr. Hill said in an interview earlier this year.
Mr. Alagirisamy told employees that Nike was reshaping its technology team and centering employees at its headquarters and a tech center in Bengaluru, India. The layoffs will affect workers across North America, Europe and Asia.
The cuts will also affect staffing in Nike’s factories for Air, the company’s proprietary cushioning system. Employees who work on the supply chain for raw materials will also experience changes as staff is integrated into footwear and apparel teams.
Nike’s Converse brand, which has struggled for years to revive sales, will move some of its engineering resources closer to the factories they support, the company said.
Mr. Alagirisamy said the moves were necessary to optimize Nike’s supply chain, deploy technology faster and bolster relationships with suppliers.
Business
Senate committee kills bill mandating insurance coverage for wildfire safe homes
A bill that would have required insurers to offer coverage to homeowners who take steps to reduce wildfire risk on their property died in the Legislature.
The Senate Insurance Committee on Monday voted down the measure, SB 1076, one of the most ambitious bills spurred by the devastating January 2025 wildfires.
The vote came despite fire victims and others rallying at the state Capitol in support of the measure, authored by state Sen. Sasha Renée Pérez (D-Pasadena), whose district includes the Eaton fire zone.
The Insurance Coverage for Fire-Safe Homes Act originally would have required insurers to offer and renew coverage for any home that meets wildfire-safety standards adopted by the insurance commissioner starting Jan. 1, 2028.
It also threatened insurers with a five-year ban from the sale of home or auto insurance if they did not comply, though it allowed for exceptions.
However, faced with strong opposition from the insurance industry, Pérez had agreed to amend the bill so it would have established community-wide pilot projects across the state to better understand the most effective way to limit property and insurance losses from wildfires.
Insurers would have had to offer four years of coverage to homeowners in successful pilot projects.
Denni Ritter, a vice president of the American Property Casualty Insurance Assn., told the committee that her trade group opposed the bill.
“While we appreciate the intent behind those conversations, those concepts do not remove our opposition, because they retain the same core flaw — substituting underwriting judgment and solvency safeguards with a statutory mandate to accept risk,” she said.
In voting against the bill Sen. Laura Richardson, (D-San Pedro), said: “Last I heard, in the United States, we don’t require any company to do anything. That’s the difference between capitalism and communism, frankly.”
The remarks against the measure prompted committee Chair Sen. Steve Padilla, (D-Chula Vista), to chastise committee members in opposition.
“I’m a little perturbed, and I’m a little disappointed, because you have someone who is trying to work with industry, who is trying to get facts and data,” he said.
Monday’s vote was the fourth time a bill that would have required insurers to offer coverage to so-called “fire hardened” homes failed in the Legislature since 2020, according to an analysis by insurance committee staff.
Fire hardening includes measures such as cutting back brush, installing fire resistant roofs and closing eaves to resist fire embers.
Pérez’s legislation was thought to have a better chance of passage because it followed the most catastrophic wildfires in U.S. history, which damaged or destroyed more than 18,000 structures and killed 31 people.
The bill was co-sponsored by the Los Angeles advocacy group Consumer Watchdog and Every Fire Survivor’s Network, a community group founded in Altadena after the fires formerly called the Eaton Fire Survivors Network.
But it also had broad support from groups such as the California Apartment Association, the California Nurses Association and California Environmental Voters.
Leading up to the fires, many insurers, citing heightened fire risk, had dropped policyholders in fire-prone neighorhoods. That forced them onto the California FAIR Plan, the state’s insurer of last resort, which offers limited but costly policies.
A Times analysis found that that in the Palisades and Eaton fire zones, the FAIR Plan’s rolls from 2020 to 2024 nearly doubled from 14,272 to 28,440. Mandating coverage has been seen as a way of reducing FAIR Plan enrollment.
“I’m disappointed this bill died in committee. Fire survivors deserved better,” Pérez said in a statement .
Also failing Monday in the committee was SB 982, a bill authored by Sen. Scott Wiener, (D-San Francisco). It would have authorized California’s attorney general to sue fossil fuel companies to recover losses from climate-induced disasters. It was opposed by the oil and gas industry.
Passing the committee were two other Pérez bills. SB 877 requires insurers to provide more transparency in the claims process. SB 878 imposes a penalty on insurers who don’t make claims payments on time.
Another bill, SB 1301, authored by insurance commissioner candidate Sen. Ben Allen, (D-Pacific Palisades), also passed. It protects policyholders from unexplained and abrupt policy non-renewals.
Business
How We Cover the White House Correspondents’ Dinner
Times Insider explains who we are and what we do, and delivers behind-the-scenes insights into how our journalism comes together.
Politicians in Washington and the reporters who cover them have an often adversarial relationship.
But on the last Saturday in April, they gather for an irreverent celebration of press freedom and the First Amendment at the Washington Hilton Hotel: The White House Correspondents’ Association dinner.
Hosted by the association, an organization that helps ensure access for media outlets covering the presidency, the dinner attracts Hollywood stars; politicians from both parties; and representatives of more than 100 networks, newspapers, magazines and wire services.
While The Times will have two reporters in the ballroom covering the event, the company no longer buys seats at the party, said Richard W. Stevenson, the Washington bureau chief. The decision goes back almost two decades; the last dinner The Times attended as an organization was in 2007.
“We made a judgment back then that the event had become too celebrity-focused and was undercutting our need to demonstrate to readers that we always seek to maintain a proper distance from the people we cover, many of whom attend as guests,” he said.
It’s a decision, he added, that “we have stuck by through both Republican and Democratic administrations, although we support the work of the White House Correspondents’ Association.”
Susan Wessling, The Times’s Standards editor, said the policy is a product of the organization’s desire to maintain editorial independence.
“We don’t want to leave readers with any questions about our independence and credibility by seeming to be overly friendly with people whose words and actions we need to report on,” she said.
The celebrity mentalist Oz Pearlman is headlining the evening, in lieu of the usual comedy set by the likes of Stephen Colbert and Hasan Minhaj, but all eyes will be on President Trump, who will make his first appearance at the dinner as president.
Mr. Trump has boycotted the event since 2011, when he was the butt of punchlines delivered by President Barack Obama and the talk show host Seth Meyers mocking his hair, his reality TV show and his preoccupation with the “birther” movement.
Last month, though, Mr. Trump, who has a contentious relationship with the media, announced his intention to attend this year’s dinner, where he will speak to a room full of the same reporters he often derides as “enemies of the people.”
Times reporters will be there to document the highs, the lows and the reactions in the room. A reporter for the Styles desk has also been assigned to cover the robust roster of after-parties around Washington.
Some off-duty reporters from The Times will also be present at this late-night circuit, though everyone remains cognizant of their roles, said Patrick Healy, The Times’s assistant managing editor for Standards and Trust.
“If they’re reporting, there’s a notebook or recorder out as usual,” he said. “If they’re not, they’re pros who know they’re always identifiable as Times journalists.”
For most of The Times’s reporters and editors, though, the evening will be experienced from home.
“The rest of us will be able to follow the coverage,” Mr. Stevenson said, “without having to don our tuxes or gowns.”
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