In a recent earnings call for Tesla's first quarter, CEO Elon Musk announced plans to step back from his responsibilities related to DOGE, a cryptocurrency project he has been heavily involved with. This decision comes at a critical time for Tesla, as the company grapples with declining stock prices and increasing scrutiny from the public and investors alike.

During the earnings call, Musk indicated that he would shift his focus back to Tesla, emphasizing his need to devote more time to leading the electric vehicle manufacturer. "Now, we're getting more of a rhythm, and so the amount of time that it's necessary for me to spend here is much less, and I can return to primarily running my companies which they need me," he stated in an interview with reporters at the White House on Wednesday evening, shortly before a report from The Wall Street Journal surfaced.

Robyn Denholm, Tesla's board chair, addressed the concerns regarding Musk's leadership directly. She firmly denied claims that the company had ever contemplated replacing Musk as CEO. In a statement posted on Tesla's official X account, Denholm labeled the Journal's report as "absolutely false," asserting, "The CEO of Tesla is Elon Musk and the Board is highly confident in his ability to continue executing on the exciting growth plan ahead." Musk also took to X to refute the article, underscoring the board's support.

This tumultuous period for Tesla has not gone unnoticed. The company has recently faced significant challenges, including protests related to Musk's decisions that have affected federal employment. This backlash has not only tarnished Tesla's brand image but also led to vandalism of its vehicles, with some owners opting to sell their cars in response. Consequently, Tesla experienced its lowest quarterly sales figures since 2022, a stark reminder of the hurdles ahead.

Furthermore, the electric vehicle market is witnessing intensified competition, especially from companies like BYD, which is backed by Warren Buffett and has managed to outpace Tesla in sales and revenue this year. As these competitors gain ground, Tesla's stock price, which saw a boost following the U.S. election, has taken a downward turn, plummeting around 30% since the beginning of 2023. This decline has raised alarms among investors regarding Musk's divided attention between Tesla and his other ventures.

Despite the challenges, some analysts remain optimistic about Musk's future at Tesla. Dan Ives, a well-known analyst from Wedbush Securities, expressed his belief that Musk's decision to step back from DOGE is a sound one, predicting that he would continue as CEO for at least another five years. Ives commented, "This situation with Musk at DOGE was reaching a breaking point, but we believe that cooler heads have now prevailed." He likened the speculated search for potential CEO replacements to a high-stakes poker game between Musk and Tesla's board.

As the company moves forward, it remains to be seen how these developments will impact both Tesla's stock performance and the broader electric vehicle market. Musk and Tesla were unavailable for additional comments outside of regular business hours.