Tesla (TSLA) shares slumped to a fresh 2022 low Friday as CEO Elon Musk promised that the clean-energy carmaker's fortunes were on his mind '24/7' as lurid headlines continue to dog the world's richest man.
Musk said he was only spending around 5% of his time on his planned $44 billion takeover of Twitter, and noted that the bulk of his focus was on hits SpaceX and Tesla responsibilities as he looked to ease investor concerns that he's become too distracted.
Musk also dismissed reports, which surfaced last night, that he had sexually harassed a flight attendant on a private jet in 2016 as "utterly untrue", saying it was a "politically motivated hit piece" and adding there was "a lot more to this story."
Irrespective of its merits, the headlines themselves reminded investors that Tesla, which has lost more than $450 million in value since Musk began pursing Twitter early last month, remains firmly connected to the actions of its highly-visible CEO.
Musk has pledged as much as $62.5 billion in Tesla shares in order to secure various levels of financing for his 'best and final' offer of $54.20 for the micro-blogging website, but said last week that the deal was "on hold" amid questions linked to the group's accounting of spam accounts has put the deal "on hold", although he says he's still committed to the purchase.
Tesla shares have fallen around 37% since Musk made his 9.1% stake in Twitter public on April 4 as investors have counted the cost of both Musk's margin loans, his sale of around $9 billion in Tesla shares and the billionaire's growing leadership portfolio, which includes space exploration group SpaceX, The Boring Company construction company and neurotechnology specialists Neuralink Corp.
Tesla shares were marked 10.5% lower in early afternoon trading Friday to change hands at $635.02 each. The stock hit a fresh 2022 low of $633.00 each earlier in the session.
Cathie Wood's ARK Investment group, which manages the Ark Innovation ETF (ARKK), has rebalanced he tech-focused portfolio to reduce its reliance on Tesla shares, which now comprise 8.2% of the fund, compared to the 8.4% taken up by new favorite Roku ROKU.
Tesla, which as seen its market value fall more than $525 billion so far this year, is also driving into headwinds powered by surging input costs, a global shortage in semiconductors, supply chain disruption that are limiting parts availability and China's ongoing 'zero Covid' crackdown that has shuttered production at its key Shanghai factory.
Data earlier this month from the China Passenger Car Association showed Tesla produced just 10,757 cars in the world's biggest market last month, selling just over 1,500 and exporting none, thanks to a 22-day closure of its Shanghai facility during the city's Covid lockdown.
The April tally is the lowest in 2 years and compares to a sale total of 65,814 in the month of March. Overall car sales in China fell 35.7% from last year in April, the CPCA said, the biggest single-month decline since the pandemic trough of March 2020.
The clean-energy carmaker is also looking at a multi-million impairment charge linked to its $1.5 billion investment in bitcoin, which it purchased last year under the direction of Musk and his view that the cryptocurrency is "really on the verge of getting broad acceptance" by both mainstream investors and the broader business community.
Estimates of Tesla's bitcoin carrying costs vary, but the timing of the purchase suggests a level of around $32,600. That value, of course, surged in the latter half of 2021, when bitcoin hit an all-time high of around $67,000, but now looks far more fragile after briefly crashing below the $25 level late last week.
"Digital assets are considered indefinite-lived intangible assets under applicable accounting rules," Tesla cautioned investors in a Securities and Exchange Commission filing tied to its first quarter earnings last month. "Accordingly, any decrease in their fair values below our carrying values for such assets at any time subsequent to their acquisition will require us to recognize impairment charges, whereas we may make no upward revisions for any market price increases until a sale."
Bitcoin prices were last seen trading 6.5% higher on the session at $30,834.60 each, a move that leaves the world's biggest cryptocurrency down 32.3% for the quarter.
