Andrew here. The big conversation on Wall Street this morning is about Elon Musk’s Tesla. The stock is falling after the company reported disappointing earnings and Musk cautioned that the next couple of quarters could be tough.

We’re also looking at Google’s parent company, Alphabet, which surprised investors with better-than-expected earnings — defying concerns that ChatGPT and other A.I. models would hurt its search business — and raising the amount of money it plans to spend on capital expenditures, including on data centers, to $85 billion.

Selling Tesla

Shares in Tesla are sinking in premarket trading on Thursday after the electric vehicle maker reported its worst quarterly revenue drop in over a decade, and after Elon Musk warned on a call with analysts of the potential for “a few rough quarters” ahead.

Fresh off his contentious stint in Washington, Musk tried to hook investors by claiming that technologies like robotaxis and humanoid robots would make the struggling automaker “the most valuable company in the world by far.”

Some on Wall Street are concerned. Growth in its core business looks rocky. The company’s problems resemble those of traditional carmakers, which typically have much smaller market valuations. Similar to Stellantis and General Motors, Tesla warned of the hit from “a sustained uncertain macroeconomic environment resulting from shifting tariffs, unclear impacts from changes to fiscal policy and political sentiment.”

There are other factors, too: Competition from Chinese rivals is fierce, E.V. demand is softening in key markets and tax credits for American buyers of these vehicles will end as the Trump administration continues its assault on green transport.