Simple damage control, it would seem, because of the Thailand hoopla. More evidence--for me--that Musk is far more typical than he is atypical: he was willing to bury this poor guy with his legal team rather than simply settling, ala Trump, Cuban, or any other ultra-rich douchebag.
Tesla is going through money so fast that, without additional financing, there is now a genuine risk that the 15-year-old company could run out of cash in 2018. The company burns through more than $7,430 every minute, according to data compiled by Bloomberg. Free cash flow—the amount of cash a company generates after accounting for capital expenditures—has been negative for six consecutive quarters and ballooned to more than $1 billion when Tesla reported earnings May 2.
On Wednesday's post-earnings conference call, Tesla took its first questions from the two analysts Musk had dismissed three months earlier, when the company reported first-quarter results. That day, the stock plunged in after-hours trading in response to what Musk called "boring, bonehead questions" from analysts.
This time, Musk showed contrition and Tesla shares surged 8.5 percent in after-hours trading Wednesday, adding about $4.75 billion to the stock's value. The stock was up 14.6 percent Thursday.
"My apologies for not being polite on the prior call," Musk said, blaming his behavior in part on a lack of sleep and overwork.
"I appreciate that," said Bernstein analyst Toni Sacconaghi, in response. "Thank you."
And Wall Street took notice that perhaps Tesla's chief executive will not distract investors with problematic behavior going forward.
KeyBanc Capital Markets called it "maybe the most valuable apology of all time."
Investors who are betting that Tesla Inc. shares are poised for a fall were sitting on a more than $1 billion paper loss Thursday, after the stock rallied more than 12% following its latest quarterly earnings.
Tesla short sellers were down more than $1.1 billion in mark-to-market losses on the 35.1 million Tesla shares that they have shorted, according to S3 Partners LLC, a company that has access to and tracks real-time short interest data. Short sellers take a view on a stock that it will fall in price. They then borrow the shares so they can sell them, hoping they can later scoop them up at a lower price, return them to the original lender and pocket the difference.
On August 7, 2018, Musk tweeted to his 22 million Twitter followers that he could take Tesla private at $420 per share (a substantial premium to its trading price at the time), that funding for the transaction had been secured, and that the only remaining uncertainty was a shareholder vote. The SEC’s complaint alleges that, in truth, Musk had not discussed specific deal terms with any potential financing partners, and he allegedly knew that the potential transaction was uncertain and subject to numerous contingencies. According to the SEC’s complaint, Musk’s tweets caused Tesla’s stock price to jump by over six percent on August 7, and led to significant market disruption.
His "funding secure" tweet was one of the dumbest moves by a CEO in history, in my opinion. Its up there with Fuld telling Buffet to take a hike when he offered $46/share to take a large stake in Lehman.
Elon Musk agreed Saturday to step down as chairman of Tesla and pay a $20 million fine in a deal to settle charges brought this week by the Securities and Exchange Commission.
Under the settlement, which requires court approval, Musk will be allowed to stay as CEO but must leave his role as chairman of the board within 45 days. He cannot seek reelection for three years, according to court filings.
He accepted the deal with the SEC "without admitting or denying the allegations of the complaint," according to a court document.
Separately, Tesla agreed Saturday to pay $20 million to settle claims it failed to adequately police Musk's tweet.
Judge Alison Nathan, a US District Court judge in New York, requested a joint letter explaining why she should approve the tentative settlement deal between Musk and the Securities and Exchange Commission. The judge asked for the letter not to exceed 10 pages and to be double-spaced. Due date: October 11.
Obviously, I think, the judge isn't too happy with this settlement. I'm guessing she's questioning why Musk should get to stay on as CEO of Tesla and not admit to having done anything wrong. Fyi, Nathan was appointed by Obama and clerked for Stevens. And she doesn't have to approve the settlement. I think there's a pretty good chance she won't. And good for her, imo.
Since some people half-jokingly refer to Musk as a real-world Tony Stark, I'd say he's currently in his "Iron Man 2" phase, specifically the part of that movie where he turns into a crazy, raging drunk to the point of pissing off and alienating everyone.
Hopefully, he practices some introspection and is able to turn things around in the sequel.