Tesla CEO Elon Musk reportedly on Wednesday that he is “obviously overpaying” for Twitter, but claims that he is nonetheless still “excited” about his $44 billion buyout deal, which he continues to drag his feet on closing. Meanwhile, Tesla missed analyst expectations due to high material costs and production problems at multiple factories.
“Though myself and the other investors are obviously overpaying for Twitter right now, the long-term potential for Twitter is an order of magnitude greater than its current value,” Musk said during the Tesla earnings call on Wednesday, according to a report by the New York Post.
Elon Musk and Cybertruck (Ringo H.W. Chiu/AP)
Musk and Twitter are still negotiating details of the deal, and have not yet reached a final agreement, which has an October 28 court deadline, according to sources close to the case. If the deal isn’t closed by the end of the month, Twitter’s lawsuit against Musk for backing out will go to trial.
Analysts speculate that Musk will need to sell billions of dollars worth of Tesla shares in order to foot the bill for Twitter. During the earnings call on Wednesday, Musk also reportedly said that he saw a path for Tesla to be worth more than Apple and Saudi Aramco, combined.
Despite Musk’s vision of a rosy future, Tesla Q3 revenues fell short of expectations, according to a report by TechCrunch.
On Wednesday, the electric car company reported revenue of $21.45 billion in the third quarter. While this was a record-setting quarterly revenue for the company, it still missed analysts’ expectations. Shares fell 4.85% in intraday trading on Thursday morning, piling even more losses on shareholders whose shares have cratered this year.
Tesla said its profits were squeezed by increases in raw material costs, issues in boosting production at its Germany and Texas factories, as well as 4680 battery cell production. The company also pointed to a strengthening dollar as another factor affecting its third-quarter results.
You can follow Alana Mastrangelo on Facebook and Twitter at @ARmastrangelo, and on Instagram.
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