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Elon Musk sorta, kinda explains his behavior on the Tesla earnings call

Tesla CEO Elon Musk.
(John Raoux / Associated Press)

Elon Musk pledged to “burn” investors shorting Tesla Inc. stock and criticized analysts and even himself after exchanges during the electric carmaker’s earnings call sent shares tumbling.

Musk tweeted that analysts at Sanford C. Bernstein & Co. and RBC Capital Markets were representing “a short seller thesis, not investors” when posing questions that Musk cut off during the Wednesday earnings call. The chief executive reiterated that an inquiry about capital expenditures by Bernstein’s Toni Sacconaghi was “boneheaded” and said RBC’s Joseph Spak posed an “absurd” query about Model 3 reservations.

“Oh and uh short burn of the century comin soon. Flamethrowers should arrive just in time,” Musk wrote Friday. That’s an apparent reference to devices he sold this year to raise money for his tunnel-digging company Boring Co.

Nine quotes from Elon Musk’s abnormal Tesla conference call »

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Tesla shares wobbled in early trading Friday; around 7:20 a.m. Pacific time, they were up 0.9% at $286.90. On Thursday, the stock sank 5.5%, its biggest drop in more than a month.

After receiving a suggestion on Twitter that blocking analysts who are going to be negative would solve his problem, Musk wrote back: “True. And once they were on the call, I should have answered their questions live. It was foolish of me to ignore them.”

Musk, 46, rejected Sacconaghi’s and Spak’s questions during the Wednesday call to discuss another quarter in which Tesla burned more than $1 billion in cash. The CEO said questions he was getting were “so dry” and told the conference-call operator to pivot instead to inquiries from a YouTube channel owner who said he was representing retail investors.

Bernstein’s Sacconaghi and RBC’s Spak both rate Tesla shares the equivalent of hold.

“There is incremental concern when, on an analyst financial quarterly call, the CEO doesn’t appear to want to talk about important financial metrics,” Sacconaghi said Thursday on Bloomberg Television. “The read-through is that potentially the CEO doesn’t care or isn’t focused about those financial metrics or ultimately the numbers don’t tell a good story. But either of those interpretations are not particularly comforting.”

Sacconaghi has a $265 price target on the stock, while Spak sees the shares falling to $280.

The news that Tesla released in its earnings report was “actually super good,” Musk said in another tweet. The company’s Model S and Model X vehicles “are producing major positive cash flow & Model 3 is about to do same,” he said.


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