Elon Musk appeared to be putting the days of wildly optimistic goals and unpredictability in the rearview mirror. Then he spooked Tesla investors with another surprise executive exit.
The chief executive officer vowed on an earnings call to cut costs and manage Tesla’s cash as it enters a slower-growth period.
Instead of madcap Musk, investors heard from a more measured CEO who had just missed analysts’ estimates for quarterly profit. He even made multiple mentions of the possibility there could be a recession.
But after all the talk of tougher times and tightening the wallet, Musk’s penchant for blindsiding shareholders reemerged. With mere minutes left on the call, he revealed Chief Financial Officer Deepak Ahuja will retire a second time, reinforcing Tesla’s reputation for having an active revolving door of top executives.
“The CFO’s surprise retirement just adds to a wave” of recent departures, said Michael Dean, an analyst with Bloomberg Intelligence.
There were plenty of reasons to suspect Musk would be more reined-in from now on. In addition to Tesla facing a “very difficult” road ahead, as he put it earlier this month, the CEO is coming off a sometimes painful 2018. A run-in with the Securities and Exchange Commission over a botched effort to take the company private cost him the chairman role. Tesla also brought in a new general counsel and was ordered to step up oversight.
Tesla shares extended losses after Musk announced Ahuja’s impending exit. The stock was down 4.5% to $295.01 early Thursday in New York. It had declined 7.2% this year through Wednesday’s close.
A sequential drop in earnings before interest and taxes, underwhelming Model 3 production and a looming $920 million bond repayment due in March also weighed on investors, Dean said. “Tesla’s effective premium monopoly is also over with competition coming through in 2019 from Porsche, Audi and Mercedes.”
The company’s new CFO will be Zach Kirkhorn, who’s been vice president of finance.
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