Why Tesla (TSLA) Stock Is Trading Up Today

What Happened?

Shares of electric vehicle pioneer Tesla (NASDAQ:TSLA) jumped 8.9% in the morning session after CEO Elon Musk announced plans to limit his involvement at the Department of Government Efficiency, suggesting a shift in focus toward his business ventures, especially Tesla. Musk added during the Q1 2025 earnings , "I think starting probably in next month, May, my time allocation to DOGE will drop significantly." 

The quarter itself was underwhelming as Tesla delivered fewer vehicles than forecasted, its revenue in all three segments (Services, Automotive, and Energy) missed, and its EPS fell short of Wall Street's estimates. 

Still, investors cheered Musk's renewed focus on the business, especially as the company continued to make significant operational adjustments towards delivering more vehicles and keeping to its promise to introduce more affordable EVs while also fending off rising competition.

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What The Market Is Telling Us

Tesla’s shares are extremely volatile and have had 128 moves greater than 2.5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 1 day ago when the stock gained 6.1% as investor sentiment improved on renewed optimism that the US-China trade conflict might be nearing a resolution. Treasury Secretary Scott Bessent reinforced this positive outlook by describing the trade war as "unsustainable," and emphasized that a potential agreement between the two economic powers "was possible." His comments signaled to markets that both sides might be motivated to seek common ground, raising expectations for reduced tariffs and more stability across markets.

Tesla is down 32.5% since the beginning of the year, and at $256.16 per share, it is trading 46.6% below its 52-week high of $479.86 from December 2024. Investors who bought $1,000 worth of Tesla’s shares 5 years ago would now be looking at an investment worth $5,445.

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