Tesla

This CNBC Morning Squawk newsletter highlights five key market insights: Elon Musk’s potential $1T Tesla compensation pending Optimus robot success, AI stock retreat amid valuation concerns, Trump’s negotiated prescription obesity drug savings, no federal bailout for OpenAI despite revenue projections, and Target’s retail strategy reset to improve the in-store experience. The labor market uncertainty and Target’s operational overhaul are also noted.

Tesla shareholders approved Elon Musk’s compensation package, potentially worth nearly $1 trillion, awarding stock options tied to ambitious performance goals, including market capitalization and profitability targets. The vote also addressed Tesla’s potential investment in xAI, but next steps are under deliberation. Despite opposition from advisory firms, the board actively campaigned for approval, emphasizing Musk’s crucial role. The plan lacks restrictions on Musk’s political activities or time commitment to Tesla, despite ongoing debate regarding his controversial statements on sales. A Delaware court ruling on a previous pay package adds further complexity.

Tesla shareholders will vote on a massive compensation package for CEO Elon Musk, potentially worth nearly $1 trillion in stock over the next decade. The board argues Musk’s leadership is crucial for Tesla’s future, particularly in robotics and AI. Some investors oppose the plan, citing its size, dilution concerns, and Musk’s other ventures, particularly growing political engagement. The vote follows a court ruling invalidating Musk’s previous pay plan. The new plan contains ambitious targets related to market cap, vehicle deliveries, and earnings.

Tesla’s German sales plummeted in October 2025, despite overall EV market growth. Only 750 units were sold, a 50% year-over-year decrease. Analysts attribute this decline to several factors: Elon Musk’s polarizing image impacting brand perception, increased competition from European and Chinese automakers offering cheaper EVs, and the discontinuation of EV purchase incentives. Tesla introduced a lower-cost Model Y in response, but its impact remains unclear. A planned government incentive program in 2026 may boost overall EV adoption but won’t necessarily favor Tesla.

Norway’s $2 trillion sovereign wealth fund, a major Tesla shareholder, opposes Elon Musk’s proposed $1 trillion pay package due to concerns about its size, dilution, and key person risk mitigation. Norges Bank Investment Management (NBIM) has already voted against the plan, citing concerns about governance implications. The news impacted Tesla shares, trading 2.4% lower premarket. The shareholder vote is a crucial test of investor confidence and could have broader ramifications for executive compensation in the tech industry. Critics argue the plan incentivizes short-term gains at the expense of long-term sustainability.

US regulators (NHTSA) are investigating Tesla’s retractable door handles over safety concerns. Complaints cite malfunctions, especially with low battery voltage, trapping occupants, including children overheating inside. The investigation focuses on 2021 Model Y vehicles but includes related Model 3/Y models. NHTSA demands records by December 10, with potential penalties for non-compliance. The investigation follows reports of injuries and fatalities and comes as industry, and Chinese regulations, prioritize simpler, safer door handle designs with accessible emergency releases.

Tesla’s Board Chair urges shareholders to approve Elon Musk’s $1T compensation package, citing his vital role in the company’s future, particularly AI and robotics. The board argues that rejecting the package could devalue Tesla. ISS recommends against it, and the “Take Back Tesla” campaign raises ESG concerns. The vote includes board re-elections. The decision hinges on Musk’s continued vision and influence versus concerns over excessive compensation and potential brand damage. Increased voting power for Musk is also under consideration.

Key morning headlines: Tesla’s earnings disappointed, prioritizing robotaxis and AI, triggering a share drop. Southwest Airlines and American Airlines reported strong earnings, contrasting Tesla’s struggles. The US imposed sanctions on Russian oil giants, causing prices to surge. Meta is cutting AI jobs amid superintelligence concerns. Starbucks workers are preparing for a strike vote over pay and working conditions, potentially impacting upcoming earnings.

Tesla’s Q3 revenue increased by 12% year-over-year, but net income plunged 37%. Price cuts to compete with Chinese EV manufacturers and a 50% surge in operating expenses, including AI investments, contributed to the decline. The market reacted negatively, with shares dipping in extended trading. This adds to broader market concerns, as other tech companies also reported disappointing earnings. Simultaneously, smaller altcoins faced a disproportionate impact during the recent crypto market correction, highlighting their increased risk.

Tesla’s Q3 earnings call left investors uneasy as Elon Musk avoided discussing key financial metrics like EV demand and tariff impacts. The stock dipped after-hours. Musk focused on future robotaxis and humanoid robots (Optimus), claiming they’ll revolutionize society. However, autonomous driving efforts remain limited. FSD adoption is low, and revenue lags. Musk also emphasized his control over the “robot army,” criticizing proxy advisors against his pay plan. Tesla’s brand perception and investor confidence appear to be declining.