Shares of Tesla (NASDAQ: TSLA) were moving higher today, overcoming a weak earnings report after CEO Elon Musk spent much of the earnings call pumping up the stock and making big promises about autonomy.
As of 1:11 p.m. ET, the stock was up 4.7% on the news.
Image source: Tesla.
Investors buy into the autonomy story
Tesla's fourth-quarter numbers were disappointing and the stock was down initially after hours when it reported earnings.
For the full year, Tesla reported a decline in automotive revenue, and in the fourth quarter, overall revenue increased just 2% to $25.7 billion, which was well below the consensus at $27.1 billion. Automotive revenue was down 8% to $19.8 billion in the quarter.
On the bottom line, results also disappointed with operating margin down from 8.2% to 6.2%, while adjusted earnings per share rose from $0.71 to $0.73, missing estimates at $0.77.
Despite the weak results, investors still bid the stock higher after Musk made bold promises around autonomy and told investors that the stock could eventually be more valuable than the next five valuable companies combined.
The Tesla chief continues to be an evangelist for full self-driving and Tesla's autonomous vehicle technology, saying that 2027 and 2028 will be "ridiculously good." He also said of the technology, "The only people who are skeptical are those who have not tried it."
All-in on autonomy
Musk and the rest of Tesla management spent little time discussing the automotive business on the earnings call, instead focusing on autonomy.
Tesla didn't give specific guidance, but it did call for the vehicle business to return to growth in 2025, though it noted it wasn't fully switching new production to its next-generation platform, which means it won't be able to lower costs as much as it hoped.
The company still faces a lot of uncertainty in 2025, but investors seem to be buying into the autonomy story. If Tesla can take steps toward full autonomy, the stock could move higher, though it still faces considerable downside risk.
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