Tesla can win with Musk less distracted by Twitter, say analysts – 05/12/2023 – Market

Elon Musk’s decision to choose a new chief executive for Twitter could remove a major distraction for the billionaire and allow him to focus more on Tesla, which has been struggling with slumping demand for its electric vehicles, analysts said.

Shares of the world’s most valuable electric vehicle maker, which has surged 40% this year, were up 2% in premarket trade on Friday. The company’s shares had their worst year in 2022, losing 65%, amid Musk’s Twitter bid.

Since he bought Twitter last year, Tesla investors fear he will not be able to give his full attention to the company, which is in a price war with new automakers and old automakers.

“It’s a positive fraction for shareholders because he’s likely to spend a little more time with Tesla,” said Gene Munster, managing partner at Deepwater Asset Management. “However, there are other things that are competing for your time.”

Linda Yaccarino, from Comcast’s NBCUniversal, was announced this Friday (12) by Musk as the new CEO of Twitter.

The billionaire has said he will take over as chief technology officer at Twitter.

“Tesla investors are likely to celebrate this move too, with Musk’s hands-on approach on Twitter leading to concerns that he has taken his eyes off the electric vehicle giant,” said Sophie Lund-Yates, an analyst at Hargreaves Lansdown.

Though Twitter has taken up much of Musk’s time since its acquisition, he still actively manages several other businesses, such as SpaceX and Neuralink. Musk recently formed an artificial intelligence company called TruthGPT to compete with OpenAI’s ChatGPT and Google’s Bard.

Musk’s engagement with the social media platform has been quite chaotic. He cut thousands of jobs at the company, fired the top executive team and its chief executive, and made many changes to its policies and strategies to rely less on ads and more on subscription money.