Markets have been jittery about who's pulling the levers of power in Washington this week, but investors finally got some of what they wanted -- more Jerome Powell, less Elon Musk.

President Donald Trump said he has no intention of firing Federal Reserve Chair Powell -- a reversal from earlier comments that suggested otherwise and had pushed stocks lower Monday.

And the prospect that Tesla CEO Musk will spend less time in Washington at the Department of Government Efficiency, the unit set up to find savings and eliminate waste, lifted Tesla shares.

The electric vehicle maker's earnings reports are usually all about Elon Musk's grand visions and he didn't disappoint. Of course, Tesla results are never really about numbers, or even cars. They're about the future -- artificial intelligence, humanoid robots, or some other engineering marvel that Musk is dreaming up. He promised that millions of autonomous Tesla vehicles would hit roads next year.

The stock popped 5% in after-hours trading, extending a 4.6% gain before the close. The daytime move was helped by a broader market jump as Treasury Secretary Scott Bessent and Trump suggested the tariffs on Chinese goods will come down.

That Musk will now be spending more time at Tesla would have been music to investors' ears after deliveries were seemingly hurt by the CEO's political activity. Confirmation the new, lower-priced Tesla model is on track to arrive this year was also good news.

But the numbers certainly weren't good. Earnings missed estimates, profit was way down, and any sales growth for 2025 is in doubt. The stock is down about 40% this year. Musk's reassurance that Trump's tariffs are "tough" but that Tesla is the auto maker least affected by them isn't that reassuring.

These results are a reminder that buying Tesla stock is a bet on its CEO, and that Musk hasn't been delivering for shareholders recently. He may well be able to turn things around, but it will be a tough road ahead.

-- Brian Swint

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CEO's Work With DOGE Nearly Done as EV Maker Falls Short

Tesla investors may look past a big first-quarter miss for the electric vehicle maker after CEO Elon Musk assured them on Tuesday that the time he spends with the Trump administration's Department of Government Efficiency "will drop significantly" in May. Still, Tesla's challenges cast doubt on 2025 guidance.

   -- Tesla reported first-quarter earnings of 27 cents a share, and sales of 
      $19.3 billion, both far below expectations, with revenue dropping 9% from 
      a year earlier and automotive revenue falling 20% in the same time frame. 
      Its average vehicle price fell to about $39,000, from almost $44,000. 
 
   -- Tesla's operating profit fell 66% to $399 million, the lowest operating 
      result since the second quarter of 2020. Automotive gross profit margins 
      excluding regulatory credit sales were about 10%, down 6 percentage 
      points from a year ago, but roughly what investors expected. 
 
   -- Tesla's market value peaked at $1.54 trillion on Dec. 17, and its stock 
      was trading at almost $427 before the Jan. 20 presidential inauguration. 
      Tesla stock has since shed about $820 billion in market value. Wedbush 
      analyst Dan Ives said investors want Musk to spend more time at Tesla 
      than in Washington, D.C. 
 
   -- Artificial intelligence remains "a major pillar of growth." Tesla is 
      expected to roll out an AI-trained robotaxi service this year and start 
      selling AI-trained robots next year. Tesla said new vehicles, including 
      its more affordable Model 2, are on track to start production in the 
      first half of 2025. 

What's Next: Tesla said it would revisit 2025 guidance when it reports second-quarter figures. Musk had previously said 20% to 30% growth was possible. That implied vehicle deliveries of about 2.1 million units. Wall Street currently expects about 1.8 million, flat with 2024.

-- Al Root and Janet H. Cho

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President Says He Has No Intention of Firing Fed Chair

President Donald Trump also seemed to de-escalate pressure on Federal Reserve Chair Jerome Powell, telling reporters he has no intention of firing the central banker despite suggesting so a few times recently on social media. But Trump did repeat his call that it's time for the Fed to cut interest rates.

   -- The Oval Office comments come after a day of appearances by Fed officials 
      ahead of the start of an official quiet period. Minneapolis Fed President 
      Neel Kashkari offered a strong defense of Powell's leadership while 
      speaking at the U.S. Chamber Global Summit. 
 
   -- Kashkari said Powell has done an "outstanding job" keeping the 
      policymakers focused on their job, and he also reaffirmed the importance 
      of central bank independence, calling it "foundational" to a strong 
      economy. "Politicians all the time offer their opinions of what they 
      think monetary policy should be," Kaskhari said. 
 
   -- White House press secretary Leavitt told reporters that Trump believes 
      the Fed and Chair Powell have been "making moves and taking actions" in 
      the name of politics, adding that the president has the right to "express 
      his displeasure with the Fed." 
 
   -- The Fed's credibility is its most precious resource, said Philadelphia 
      Fed President Patrick Harker at a conference on economic mobility. "What 
      we do, what we say -- we don't just wing it, we base it on solid evidence, 
      " he said. "We've built that [credibility] over time by being 
      apolitical." 

What's Next: Legal scholars have debated whether Trump could lawfully remove Powell, but Trump's attacks are already having an impact. Pimco analysts recently wrote that Trump could be doing longer-term damage to the perception of Fed independence.

-- Nicole Goodkind and Matt Bemer

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White House Says Tariffs on Chinese Goods Will Be Substantially Lower

President Donald Trump appeared to soften his stance in his trade war with China, saying U.S.-imposed tariffs of 145% on imported goods from China will come down "substantially" once the two sides negotiate a deal. U.S. tariffs on Chinese imports won't be anywhere near that high, he said.

   -- Trump, answering questions in the Oval Office, said the tariffs wouldn't 
      drop to zero, either, but he expressed confidence China would come to the 
      table. The two countries have faced off in an escalating trade battle, 
      with China slapping 125% tariffs on U.S. goods. Trump suggested he 
      wouldn't play hardball. 
 
   -- The more conciliatory tone followed earlier remarks by Treasury Secretary 
      Scott Bessent, who told an audience in Washington that he expects the 
      U.S. and China to begin de-escalating their trade hostilities in the very 
      near future. He added that engagement with China hadn't begun, a person 
      told Barron's. 
 
   -- Countries around the world are racing to complete trade deals before the 
      Trump administration's additional country-specific levies kick in this 
      July. White House press secretary Karoline Leavitt said 18 written 
      proposals have been brought to the administration's trade team, and they 
      are meeting with 34 countries this week. 
 
   -- A 10% U.S. tariff on imported goods would generate $2.9 trillion in extra 
      federal revenue over a decade, the Peterson Institute for International 
      Economics found. But lower economic growth, plus likely retaliation, 
      would cut the net tax revenue to $1.6 trillion, lower than Trump 
      administration estimates. 

What's Next: The International Monetary Fund has lowered its expectations for global economic growth to 2.8% this year and 3% next year from estimates it put out in January before the Trump administration's tariffs. It stopped short of forecasting a recession, but the odds of one have risen to 30%.

-- Matt Peterson, Janet H. Cho, and Liz Moyer

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AT&T Adds Cell-Phone Customers, Contrasting Verizon's Subscriber Losses

AT&T topped Wall Street's revenue and phone subscriber targets Wednesday, and those gains could be coming at a rival's expense. Tuesday, Verizon Communications lost more customers than analysts were expecting, amid worries that an economic slowdown could chip away at demand for its premium plans.

   -- AT&T reported earnings of 51 cents a share ahead of the opening bell, as 
      revenue rose 2% from a year ago to $30.6 billion. Analysts were expecting 
      earnings of 51 cents a share on revenue of $30.4 billion, according to a 
      FactSet poll. 
 
   -- The wireless carrier said it had added 324,000 postpaid net phone 
      subscribers, beating the 303,000 net adds analysts were forecasting. It 
      could be that it's luring customers away from Verizon, which reported 
      more postpaid subscriber losses than analysts were expecting Tuesday. 
      AT&T is often associated with offering more budget-friendly plans than 
      its rival, so could benefit if President Donald Trump's tariffs drive up 
      inflation and causes consumers to hold back on spending. 
 
   -- AT&T also stuck by guidance it had issued in March, which investors could 
      take as a sign that it isn't too worried about Trump's levies, and 
      brought forward its stock-buyback plan to the current quarter, having hit 
      a key debt-reduction target. 

What's Next: It's a case of two down, one to go for the three biggest wireless carriers this earnings season. T-Mobile US is due to report its results after Thursday's close. The telecom stocks have been outperforming the S&P 500 year amid tariff worries, signaling investors probably see them as good defensive picks.

-- George Glover

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Are Antiquities Covered or Exempted From Levies? It's a Coin Toss.

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April 23, 2025 07:04 ET (11:04 GMT)

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