Tesla On The Move After Reporting Results… And Picks & Shovels Of AI Trade 4/22/26

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1:07Tesla takes off. Shares of the EV maker popping after an earnings beat. What the company had to say about margins, its humanoid robot, and when we will finally see cybercats on the road. We're surrounding the trade this hour. And the picks and shovels of the AI trade in rally mode today with the gains in everything from semis and memory stocks to power providers say about the state of big tech. Plus, pot stocks light up. Boeing shares soar after earnings and Best Buy names a new CEO. What new leadership will mean for the electronics retailer and how you should trade the stock now? I'm Melissa Lee.

1:37Come to you live from Studio V at the NASDAQ. On the death tonight, Tim Seymour, Dan Nathan, Steve Grasso, and Katie Stockton, founder and managing partner at Fairlead Strategies. We start off with Tesla moving higher after posting first quarter numbers. Earnings coming in ahead of estimates while revenues fell slightly short. The company also saying it's making meaningful progress in its robo-taxing robotics businesses. Phil Abose got all the numbers and the details. Phil. Melissa, a lot to like in these numbers if you are a Tesla bull. The company earning 41 cents a share. That was 4 cents better than the street was expecting at 37 cents a share.

2:10Revenue, as you mentioned, coming in a little bit shy of expectations, coming in at 22.39 billion. The street was at 22.64 billion. And then some key numbers within the numbers in the first quarter. Gross margins north of 19%. Anything between 15.5 % and 17 % is where most of the analysts were expecting. So this is better than expected at more than 19%. Free cash flow,$1.4 billion, a pleasant surprise. That's because CapEx was not as great as many were expecting. And then you have FSD subscriptions,$1.28 million. For a point of reference, at the end of the fourth quarter, it was$1.1 million FSD subscriptions.

2:51By the way, that 1.28 million, 51 % jump year over year. And in terms of production, you talk about the CyberCab. There has been some news, at least this is what Tesla is saying in its earnings report. The CyberCab and Tesla Semi will be going toward volume production. They are on track for that to happen this year. And the Optimus factory is expected to begin production shortly in Q2. That's according to Tesla in its earnings report. As you take a look at shares of Tesla over this last year, keep in mind the real mover of this stock is coming up in about 25 minutes. That's when we'll hear from Elon Musk during the analyst conference call.

3:31Melissa, I'm going to send it back to you. But this is one of those days where if you were a Tesla bull, you're looking at at least the numbers right now and saying, all right, I like what I'm seeing. Yep. Phil, thank you. Keep us posted. Phil LeBeau with all the sort of puts and takes of the Tesla quarter. You know, part of the bull case is physical AI and we are seeing it. I mean, it is a reality. It's not just humanoid robots out in the future. It's beginning production in Q2, cyber cab, semi truck. It's not out in the future. It is volume production this year. It is playing out, Tim. It is.

4:02And it's doing it at a gross margin that, as Phil pointed out, 19.7 percent. The regulatory credit is a good story and a story that's greatly improved over where it was. I think the dynamic around energy storage is also kind of interesting, although those numbers were slightly lower quarter over. quarter. I think it gets back to really where are we with Optimus? Where are we with cyber? And those are details we're going to get at 530. I think there's still some unknown about what's going on with Tesla and SpaceX, too, even though I think that's I don't think that's something we're getting or something we're going to hear about.

4:36But it is something the market wants to know. Is it interesting that I didn't think Phil really built out on cars? I don't think Tim really built out on cars. You didn't say anything about cars. I said nothing about cars. So this is not a story about cars anymore. So this is a story about FSD, free cash flow, and margins. And they're hitting on everything right now. And then you throw in some humanoid or some robots. So I think they've changed the narrative enough to put the bar where they know they could step over it. Margins. It looked like a one-time thing. It looked like early tariff refunds and then some warranty reserves, everything.

5:14So if everyone is focused on... I know how to read, and Claude's amazing. I mean, this guy, Claude, is amazing. He's so smart. Margins was a thing that used to drive it. It was deliveries, right? And it was... The fact is that Elon used to guide 50 % year over year of those sorts of deliveries. They started falling short or whatever. But I'm with you guys. If they printed 17.6, I don't think it really would have mattered. And, you know, if you look at FSD and they're looking at the progress they're making there and, you know, miles driven and all that sort of stuff. But it is interesting to note that, you know, their FSD is still supervised FSD for the folks that actually own the car.

5:55That's not going to be at a robo taxi. So, again, you know, maybe it's not about the cars that they're selling to individuals right now. It is more about the production that's going to go into a fleet. To me, it's one of the more attractive mega cap stocks. It's actually kind of diverged from the group. and it tends to have a weak first quarter, which is, of course, what we saw this time around. And because of it, it came into this print pretty oversold on a weekly basis. Retests are somewhat common, very strong support in the 351 area. And resistance, honestly, is not that strong until you get to the highs around 488.

6:30So I think it's an interesting set-up, secular uptrend. You know, if you are wanting to invest in the physical AI story, There aren't that many pure plays out there. There aren't many other companies that you can do that with. I mean, Waymo is a very small part of the alphabet story. I can't even think, I mean, robotics companies out there. I mean, I don't even know. I mean, Tesla fills that sort of void in the AI trade. It's funny that this is now a pure AI trade and not an auto company. Yeah, I mean, I don't know if it's a pure AI trade, but I mean, it fulfills that sort of notion of a physical AI.

7:04No question. And I still think we just don't know from a capital markets perspective what Elon might put through here. And he's well incented to take this market cap higher. So I think your point is well taken. I think there are other parts of the story. I mean, FSD approval in Netherlands, where is it going to be next? I mean, there is really some decent follow through on some of the stories that, again, don't get me excited. But I think it's interesting what Katie's bringing up. And I give Dan some credit, who called this stock back in November, which is this stock has these these moments where it has, in fact, lagged.

7:37And, in fact, you see almost a rotation by people that are not one point out Tesla investors. There are people that are opportunistic and tactical. This is a market right now, at least the market we have, where semis are going to all time highs, where this this company is supposed to rally. And I think because someone like me might hold my nose on the valuation and say, I don't even understand it. There are plenty of people that aren't that predisposed. predisposed and I think are buying it. It reminds me back in the back in the day with Amazon when you had AWS and people didn't understand the AWS angle that they could turn that spigot on, they could turn it off whenever they wanted.

8:11He's got a bunch of flows now that he can really look to. But he definitely did attract in the stock. Maybe Katie can speak to this. I'm long from right around here. So I suffered with it a little bit on the downtrend. And now I'm staying with it. And I'm looking for probably 10 percent move to the upside. Where do you see it stopping technically? You know, so there is a minor level around 410, which maybe that is tested soon. The problem is that the influence of the market is very real on the chart of Tesla. Right. So as you bought it and it went down, that was probably mostly related to the market.

8:45Right. Not something specific to Tesla. So the market influences are very real. And I think it largely depends on whether you think the equity market can continue higher from here. after such a strong move as to what kind of gains we'll see, at least in the near term. If you're a believer in Elon Musk and his vision of the future, are you an investor in Tesla or are you an investor in the SpaceX IPO to come? Probably SpaceX and partially because I think these companies will ultimately merge if you think about it. And, you know, if you think about this incentives that Tim just mentioned that he had for Tesla when that came out, I mean, there was not really a whole heck of a lot of talk about SpaceX and the valuation was coming at.

9:23And that valuation has been skipping higher, you know, went from$250 to$500 to where they're talking about right now. And he's going to have similar incentives as it relates to SpaceX. The other thing that's really interesting, it came out, I think the information was reporting this the other day, that in a secondary sale, obviously in the private markets, Elon bought$1.4 billion worth of stock in SpaceX. Now, if you go back since the IPO of Tesla. Sorry, when was this? This was, I think, either late last year or early this year. And it's kind of indicative of what he used to do with Tesla. They used to have all these different offerings.

9:55This is, you know, after their IPO, secondaries, converts, that sort of thing. He used to buy on all of them. Like when the stock, when they were like not producing a whole heck of a lot of cars, this is 11, 12, 13, that sort of thing. So I think that actually bodes very well. He's obviously all in. He's obviously going to be the first trillionaire out there. He's got a couple different levers in which to play it. And so why not buy in if you have this vision of the future that he has? Dan, sorry, Dan brought up an interesting fact when you said, what are you more excited about? And he said, I think they merge them.

10:24I think that's the only way that he actually gets his pay package, right? So the trail to getting that trillion dollars is merging every company that he's ever thought about. Isn't Tesla cheaper? I mean, that's a backdoor way into SpaceX. Right. Yeah. That's why I hear it. Yeah. That was my point, but thank you. For more and all of this. That's for you, Tesla, Volgine Monster. Gene, great to have you with. You're, of course, managing partner at Deepwater Asset Management, somebody we would never replace with Claude, by the way. What was your take on the quarter, and why do you think the stock is higher?

11:00Most of the stock is higher probably because of this margin piece. It was essentially 19.2 % was the autonomous garage X credits. Dan did mention there was some noise in there. If we back out that noise, we're still looking at a high 18 % number that compares to 17.9 % in the previous quarter. Now stick with me, is that deliveries were down 14 % quarter over quarter. Typically when deliveries decline, then you have lower gross margins on auto. And so I think that that was kind of the initial reaction once the numbers came out as investors were looking at that and we saw that 4 % pop. As I dug through the numbers, a couple themes really reinforce this idea that they're doing well when it comes to physical AI, but I want to also underscore how early we are.

11:48And so based on me looking at the charts in their shareholder deck, they probably grew their FSD miles 93 % quarter over quarter, and they doubled their paid miles for the robo-taxi. But I want to quickly put those into perspective is that sounds great. They're doubling right now. Tesla as those doubling on the FSD miles that accounts for about 0.2 percent of total miles driven in the U.S. It still is just a fraction of a fraction when it comes to autonomous miles driven. If we take what Waymo is driving and what we just reported with Tesla, it accounts two and a half percent of the total ride share miles.

12:30So very early. Last fun fact, if you look at the RoboTaxi paid miles driven and compare that to Waymo, Waymo is about 50 times bigger. Wow. That is a fun fact, Gene. I want to ask you about the transition or, you know, the sort of the increase in production. We'll see an optimist and how it will impact sort of what is going on elsewhere in the company in the in the shareholder deck. there was some language around turning off basically a couple lines of vehicles and putting optimists in there. What does that mean in terms of margins and just sort of mix shift as this transition happens? Well, the units are going to be just so small.

13:13Of course, Elon's talked about that million optimists for calendar 27, and we all know how to kind of factor in that million number. And so I think that this is really about storytelling related to what they can do even further in physical AI. It is storytelling today, but if you fast forward five, ten years from now, I think there is going to be some substance around this humanoid opportunity. As far as your question about the impact to margins, since units are going to be still so small and the investment relative to everything else they're doing is still relatively small, I wouldn't expect too much disruption there.

13:45Gene, when you look at this, you sound like you still look at it as a car company and you're still factoring in car and delivery numbers and pricing overhang on the story. What are you most focused on for the future? And do you just buy this stock as an access point to SpaceX? I think you had it right in the setup here, Steve, that this, it's not a car company. I talk about that because those are important because deliveries are part of the network that eventually they can monetize through FSD and kind of car production is a way that they can build robo taxis that can further monetize that. So yes, I think that this is a physical AI company.

14:26I think we're starting to see the substance in these numbers. They are very small right now. And as far as like an access point to what's going on with SpaceX, you know, this relationship eventually is going to come together. I agree, Dan, with your commentary on that. It's probably a couple of years out and I just want to come back. I mean, my thesis on SpaceX is this is not gonna they're not gonna position themselves as like a space company it's gonna be a sovereign AI company and Tesla is this is essentially the physical AI piece you really can't have sovereign AI unless you have the whole story unless you have a physical AI piece and they need Tesla to do that hey Gene well you know you gave a great example why physical AI is really I guess really a big part of both these stories right and ultimately they're gonna merge there's going to be one big story.

15:13Where else are you thinking about that as a play, right? If we think about AI in general, we kind of have the ecosystem down here and, you know, it's the components that go in the servers and go in the racks and they get cooled and they go in the data centers, all that sort of stuff. But where else are you thinking about this and as this kind of broadens out away from just data centers? Well, I mean, AI is a theme and then within that we have sub themes. And probably the most exciting sub-theme right now is energy, I think, and then separately optics. And on the energy side, some of those companies have gotten bid.

15:45There's some companies that are really boring companies that traditionally we wouldn't look at. We have an ETF, LOUP, that invests in these smaller, some 500 billion companies that kind of play into this. But safe to say is that what we're hearing, what we're seeing in the Tesla numbers today and what we've seen more broadly from TSM and ASML last week is that I think we're still early. And I think that this energy piece is going to be an underappreciated for probably a matter of years in terms of the investing community or will soon be appreciated in the coming years. Gene, keep us posted on the conference call.

16:24That gets underway in just about 15 minutes time. Elon Musk should be on it. Gene, we'll check in with you later. Thanks, Gene Munster. Meanwhile, the proverbial picks and shovels of the AI trade leading the Nasdaq to new records today. Chip stocks for one soaring, the SMH ETF hitting an all-time high, led by big breakouts in Micron, AMD and Broadcom. The memory stock, Darling, is also making big moves. Sandisk, Seagate, Western Digital with outsized gains. Brownhill's new DRAM ETF. Yes, there is a DRAM. There's an ETF for everything. But that is seeing more than $1 billion of net inflows in just 10 days.

16:58And strong earnings and guidance from data center provider GE Vernova this morning, lifting names like Constellation Energy, Talon, Eaton as well. So what do these moves tell us about the AI trade? Where do you see strength, Katie? Gosh, I mean, mostly semiconductors, as you mentioned. So I went into the S &P 500. I sorted it by month-to-date returns. And every one of the top stocks is a semiconductor stock of different varieties. But it's just a broad-based move within the complex. And it really needs to sustain itself in order for the market to sustain its rally. We do have a lot of breakouts on the charts.

17:34These breakouts are not confirmed yet, though. So what we like to see is more than just a week above, but a second week above. We don't want to see the gaps from last week penetrated very quickly. That's another thing for folks to watch. When you see these very fast and furious rallies like we have done, they're more often fragile, sort of countertrend. So with that in mind, I'd just be managing risk, but hopefully enjoying the returns while they're here. And Katie, where is that breakout on NVIDIA, by the way? Because I think if we get a breakout on NVIDIA, look out is my view. And the move on semis, while you're checking that, what's that chart level?

18:13Because for, yeah, so for NVIDIA, the resistance, the final resistance is around 212. But Broadcom is already through equivalent resistance. So I see them almost as one in the same just by the way they act. So I'm sort of treating NVIDIA like it's very close to all-time highs, treating it as a pending breakout with the rest of the group. And indeed, I mean, it's really lifted the major indices in a meaningful way. So we're going to translate what we see in the semis to that. But there are very widespread short-term sell signals from the DeMarc indicators. And these are the first sell signals that we have seen on the way up.

18:52And they show exhaustion. And they They are pretty timely in general, and they only have short-term implications on the daily charts. But for about two weeks, we'd expect consolidation. It's so hard. I mean, this is what you do. And you talk about demarks and exhaustion and all that. I just look at things like Micron that breaking out up 8.5%. It doesn't seem like there's any slowing down there. And the Sandus, it's up 70%, you know, in less than a month or so. And I think all of us have been around in the markets for a while. And, you know, you can call something a bubble. It doesn't mean you're calling the top.

19:22It doesn't mean you're saying that, you know, the fundamentals of these companies that are rallying these ways don't make a lot of sense. But, you know, at the end of the day, this is a bubble and it will burst. And so a lot of folks, you know, are only things and it's fabulous. And you just said about ETFs and these things are becoming outsized positions in a lot of different ETFs. And that's a great way to participate it. But make no mistake about it. I mean, there is idiosyncratic risk in some of these things. If a SanDisk goes from$20 to$1 ,000 in a year, if it were to go from$1 ,000 to$500, you should not be surprised if that happens at some point.

19:55So I thought that Micron topped out mid-March, and I looked good for about a month, and now it's overtaken that level. This is something where it's 75 % DRAM, 25 % NAND. And if you look at NVIDIA's chips, they're riddled with HBM, high bandwidth memory. That's where Micron has their sweet spot. I do believe this is in a quasi-bubble, and I wouldn't be a buyer here in my crowd. Coming up, we'll keep an eye on shares of Tesla in the after hours. The conference call about to kick off. We'll be listening in, bringing you all the headlines from that, as well as the other reports tonight. But first, Boeing soaring on its own report this morning, what the CEO had to say about 737 production that had shares taking off.

20:33Don't go anywhere fast when he's back in two.

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21:48Learn more at uber.com slash safety. Welcome back to Fast Money. Boeing flying to the best gain of the year after reporting better than expected results for the first quarter. The planemakers seeing a narrower loss on increased deliveries and improvements in the defense and services parts of its businesses. is CEO Kelly Ortberg spoke to our Phil LeBeau about the ramp up in production and its cash flow goals. I think we posted a better first quarter in terms of free cash flow than we anticipated. So we're on track for a second half positive cash flow and a full year of positive cash flow. It's all a part of our recovery.

22:22He also talked about potentially the meeting between President Trump and Xi yielding some new plane orders, which could benefit Boeing. I mean, you've been in this one for... I love this one. And boy, I wish it was the B in Timbo. It's not. It's not. What is the B in Timbo? Biogen. Biogen's been fine. But I mean, this is Boeing's time to shine. And yes, Boeing was on the beauty tour with President Trump, too, a year ago, or at least around, you know, tariff dynamics. And it should be. There's no question. We know how important the company is in terms of what's going on in airspace and manufacturing.

22:56We know about the duopoly. But the most important thing here is this company is generating free cash flow. We heard about CapEx. It's kind of in line with where we thought it was going to be. It's not getting out of control. I think that's really the story. I think the margin beat is something in BCA that's very important. And I think that's something else. If you can get a margin story on top of that, that free cash flow starts to become a bigger story. They're out producing Airbus. I think, you know, head to head competition there. And if you look at the stock itself, it is about free cash flow, return to positive free cash flow.