Tesla (NASDAQ: TSLA) rallied 1% on Friday, rebounding from its 50-day moving average after a mixed earnings report. The electric vehicle giant, which hit an all-time high of $488.53 on December 18, reported fourth-quarter earnings and revenue that fell short of expectations. Despite this, CEO Elon Musk announced ambitious plans, including the rollout of unsupervised full self-driving technology in Texas by June and the introduction of a robotaxi in 2026.
For Q4 2024, Tesla reported earnings per share (EPS) of 25.71 billion. Analysts had anticipated EPS of 27.26 billion, according to FactSet. Looking ahead, consensus estimates suggest Tesla’s profits will return to year-over-year growth in 2025 after an expected dip in 2024.
In a potential financial boost for Tesla (NASDAQ: TSLA), The New York Times reported on Friday that automakers struggling to meet stricter European Union (EU) carbon emission regulations are exploring the option of “pooling” with electric vehicle (EV) manufacturers like Tesla and China’s Geely. This move could provide Tesla with an additional revenue stream as demand for EVs in Europe shows signs of softening.
Under the EU’s stringent carbon emission rules, automakers that fail to meet emission targets face hefty fines. To avoid penalties, many traditional automakers are considering pooling arrangements with EV manufacturers, which generate surplus carbon credits due to their zero-emission vehicles. Tesla, as a leading EV producer, stands to benefit significantly from such partnerships.
Microsoft (NASDAQ: MSFT) continued its strong performance, rallying after reporting better-than-expected fiscal second-quarter results. The software giant earned 69.6 billion, driven by its booming artificial intelligence business. However, decelerating growth in its Azure cloud unit and a below-consensus revenue outlook for the current quarter tempered some enthusiasm.
Meta Platforms (NASDAQ: META) gained 0.2% on Friday, extending its rally after hitting a new high earlier in the week. The social media giant reported Q4 earnings of 48.38 billion, up 21%. Despite a weaker-than-expected revenue outlook for Q1 2025, Meta’s stock remains a standout performer, boasting a perfect 99 IBD Composite Rating.
Alphabet (NASDAQ: GOOGL), the parent company of Google, rose 1.5% on Friday, further extending its gains beyond the buy range of a cup-with-handle base. The stock reached a record high, reflecting strong investor confidence in its growth trajectory.
CWEB Analyst Perspective:
CWEB analysts noted the mixed performance among tech giants, highlighting the divergent trends in the sector. “While Tesla and Apple face near-term challenges, companies like Microsoft, Meta, and Alphabet continue to demonstrate resilience and innovation,” said a CWEB analyst. “The tech sector remains a key driver of market performance, but investors should remain selective given the varying growth prospects.”
As the tech sector continues to evolve, investors are closely monitoring earnings reports and growth forecasts to identify opportunities and risks.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should conduct their own research or consult a financial advisor before making investment decisions.
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