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Tesla, a brand once synonymous with consumer electric vehicles, is ditching some of the cars that brought its success. CEO Elon Musk has announced that the Model S and X vehicles are getting an honorable discharge, with production of them ending sometime next quarter. Instead, the company will use some of its factory space to build its humanoid Optimus robots. The news, shared during Teslas quarter-four earnings call on Wednesday, January 28, comes as Tesla expands manufacturing of its Optimus robots, full self-driving vehicles, and robotaxis. In fact, Tesla used its quarterly earnings report to describe itself as a physical AI company. That report holds many of the answers as to why. Teslas total revenue fell 3% year-over-year from $25.7 billion to $24.9 billion, while its automotive revenues fell 11% YOY from $19.8 billion to $17.7 billion. In quarter four, production of Model S and X vehicles dropped by 48% YOY, while deliveries fell 51% YOY. None of this was helped by Elon Musks polarizing political views, on-again, off-again relationship with President Donald Trump, and the termination of $7,500 EV tax credits last fall. Despite all this, Musk used the investors call to make one last push to customers: If you’re interested in buying a Model S and X, now would be the time to order. The two models made up less than 3% of deliveries over the last quarter, with the remainder being Model 3 and Y vehicles. The latter two models appear to still be available for Tesla customers. Whats next for Tesla? Tesla is all in on AI. Earlier this month, the company invested about $2 billion in xAI, another Musk venture. The pair also created a framework agreement to collaborate on AI that should enhance Teslas ability to develop and deploy AI products and services into the physical world at scale, according to Teslas quarterly report. The company plans to announce the Gen 3 version of Optimus this quarter and says its the first one designed to be mass produced. Tesla aims to start production of the humanoid robot by the end of this year and plans to reach one million robots annually. However, Musk noted that Tesla is still at the early stages when it comes to Optimus. So far, it has only completed some basic factory tasks. Finally, Tesla is continuing to push its full self-driving mode and robotaxisthough most places still require a safety monitor. The pivot doesnt seem to have rattled investors. Shares of Tesla Inc. (Nasdaq: TSLA) rose a bit over 2% in premarket trading on Thursday. The stock is up more than 10% over the last 12 months.
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E-Commerce
The Trump administration’s high-profile deployment of federal troops to six U.S. cities has cost taxpayers roughly $496 million through the end of December, and continued deployment could cost over $1 billion for the rest of the year, according to new data from the nonpartisan Congressional Budget Office.President Donald Trump has justified sending National Guard troops into U.S. cities as part of an effort to combat crime and support local law enforcement. Critics of the move argue the deployments undermine state and local authority and exceed the president’s authority under the Constitution.The CBO published the new data estimating the costs associated with the federal deployments of National Guard and active-duty Marines after a request from Sen. Jeff Merkley, D-Ore., who is the ranking member on the Senate Budget Committee.“The American people deserve to know how many hundreds of millions of their hard-earned dollars have been and are being wasted on Trump’s reckless and haphazard deployment of National Guard troops to Portland and cities across the country,” Merkley said in a statement about the CBO report.Factored into the estimates are troop deployments to Chicago, Memphis, Portland, as well as Los Angeles in June, when protesters took to the streets in response to a blitz of immigration arrests. The CBO said continued deployments to those cities would cost about $93 million per month.The estimate excludes the military’s December deployment to New Orleans.For further possible deployments down the road, the CBO estimates deploying 1,000 National Guard personnel to a U.S. city in 2026 would cost $18 million to $21 million per month, depending on the local cost of living.National Guard troops are expected to remain deployed in Washington throughout 2026, according to a memo reviewed by The Associated Press earlier this month.The troop deployments have provoked legal challenges from local leaders, and some have been successful. A California federal judge in January ruled that the Trump administration “willfully” broke federal law by sending National Guard units to the Los Angeles area.White House spokeswoman Abigail Jackson did not address the CBO’s cost estimate but said in a statement that the White House’s deployment efforts have driven down crime.“Thanks to the Trump Administration’s highly successful efforts to drive down violent crime, cities like Memphis and D.C. are much safer for residents and visitors with crime dropping across all major categories,” she said. “The media should talk to individuals who are able to go about their daily lives without fear of being assaulted, carjacked, or robbed thanks to the Trump Administration.” Fatima Hussein, Associated Press
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E-Commerce
Shares of Facebook owner Meta Platforms (Nasdaq: META) are surging in premarket trading this morning after the company announced its fourth-quarter 2025 earnings yesterday afternoon. The earnings not only exceeded investor expectations, but CEO Mark Zuckerberg also laid out his vision for how artificial intelligence is set to transform the companyand personal computingin the years ahead. Heres what you need to know. Meta reports strong Q4 2025 earnings Expectations for Metas Q4 2025 were relatively high, but when the company announced its latest quarterly earnings after the bell last night, they exceeded what most investors had hoped for. Here are the key financials Meta reported: Quarterly revenue: $59.89 billion Earnings per share (EPS): $8.88 Quarterly revenue was a 24% increase from the same period a year earlier. As noted by CNBC, it also blew past LSEG analyst expectations of $58.59 billion. In other words, Meta brought in around $1.3 billion more than most people thought it would. Thanks in part to its strong revenue, Meta also beat earnings per share (EPS) estimates. Most LSEG analysts had been expecting an EPS of $8.23. Meta beat that by 60 cents per share. The company also revealed some other interesting metrics, most notably about its user base. For the quarter, Meta reported a family daily active people (DAP) metric of 3.58 billion. Family daily active people is the term Meta uses to encapsulate how many individuals use its family of products on a daily basis. Metas family of products includes Facebook, Instagram, and WhatsApp. Metas family DAP for the fourth quarter grew 7% year over year. Looking ahead at the companys financials, Meta said it expects its current first-quarter 2026 revenue to come in at between $53.5 billion and $56.5 billion. Thats significantly ahead of the $51.41 billion most analysts were expecting. Zuckerberg tries to predict the futureagain Meta didnt just reveal its financial metrics. Zuckerberg also spoke about the future of technology and the way artificial intelligence will both boost Metas business and change personal computing more broadly. To the latter point, the chief executive said he believes AI-powered smart glasses will represent a paradigm shift in personal computing, likening the specs to the smartphones impact on computing, and saying glasses will be the ultimate incarnation of the device we use most efficiently to consume AI content. They’re going to be able to see what you see, hear what you hear, talk to you and help you as you go about your day, and even show you information or generate custom UI right there in your vision, Zuckerberg stated in comments posted to Facebook. I think we’re at a moment similar to when smartphones arrived, and it was clearly only a matter of time until all those flip phones became smartphones,” he added. “It’s hard to imagine a world in several years where most glasses aren’t AI glasses. His statement here isnt much of a surprise, however, considering how Meta has long worked on devices aimed at dethroning the smartphone as peoples personal computer of choice. Meta first tried to do this with its virtual reality headsets and virtual metaverse world. These initiative were run by the companys Reality Labs division. But early this month, Meta initiated massive layoffs at Reality Labsand admitted that its VR product never caught on with the general public. AI as an advertising booster Any hardware that Meta makes still represents a minuscule part of Facebooks revenues. The company is, after all, primarily an advertising company, not a hardware technology one. Around 97% of its revenues are made from selling ads across its platforms. Not surprisingly, Zuckerberg touched on how artificial intelligence would be a boost to its current ad business. The Meta CEO said that it was currently working on merging its LLMs with its ads system and said that its current world class recommendation systems, which its ads rely on, were still primitive compared to what will be possible soon. As an example, Zuckerberg pointed out that Meta’s existing ad systems help businesses find the right, specific users who are likely to purchase their goods. But thanks to AI, New agentic shopping tools will allow people to find just the right very specific set of products from the businesses in our catalogue. It’s not the only way that Metas ad business stands to benefit from the artificial intelligence boom. Meta, like many tech giants, is rushing to build out its personal data center capacity to run artificial intelligence tools on. By owning the data center directly, Meta and these other companies will be able to cut down on costs, which are currently paid to third-party data center owners. As analyst firm MoffettNathanson pointed out in a research note on Thursday, Metas buildup of its own data centers could benefit its business. [Given] the AI capacity constraint facing the industry, Meta has been forced to use third-party cloud offering as their own data centers are not ready to move online yet, the research firm noted. Longer-term, these workloads should shift from 3rd party contracts to Meta’s own facilities which, we think, should produce margin leverage. Metas stock price jumps Given Metas robust Q4 2025 results and a Q1 2026 forecast that beat what most analysts were expecting, its little surprise that the companys stock price is surging in premarket trading this month. As of this writing, shares of Meta Platforms (Nasdaq: META) are up around 8.8% to $668.73 per share. In its Thursday note, MoffettNathanson maintained its “buy” rating for Meta’s stock and increased its price target to $810. As of yesterdays close, META shares had only increased about 1.3% year-to-date, according to Yahoo Finance data. If the companys premarket stock price gain holds when markets open, that will mean Metas stock has already surged 10% in the first month of 2026. Todays premarket gain also means that Metas stock price is now out of the red for the past year. As of yesterdays market close, Metas stock was down about eight-tenths of a percent over the past year. That contrasts with the Nasdaq Composites broader gain of around 21% over the same period.
Category:
E-Commerce
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