Saturday, May 3, 2025

Foreword

Alyson Shontell

Editor-in-Chief

Earlier this week, the Wall Street Journal reported that Tesla (No. 40) board members had engaged a search firm to find a successor to Elon Musk as CEO. The paper also reported that board members told Musk, who’s been busy in Washington, D.C., with DOGE, that he needed to pay more attention to the automaker.

The company and Musk quickly swatted down the report, but it begs the question: What is Tesla worth without Musk?

Fortune senior editor-at-large Shawn Tully has been all over that question in his recent coverage. His assessment: The company would be worth just a tiny fraction of its current value.

“Investors are baking in tons of extra worth,” Shawn explained recently, “centered on great expectations that Musk will score on robotaxi fleets, and sales of [full self-driving] software to existing Tesla owners so they can run their cars like customer-owned Ubers and Lyfts.”

Tesla’s stock has rebounded recently, but the business still looks bleak. And as a result, as Shawn wrote this week, “What I call the ‘Elon Musk Hope Premium,’ the bulge investors award for the products he’s touted but that haven’t yet arrived, accounts for $850 billion, or over 90% of the current market cap.”

But while skeptics see that Musk premium as a personality-driven bubble, backers see it as a realistic assessment of its long-term prospects—even if Musk steps down. Top Tesla bulls, like ARK Invest CEO Cathie Wood, believe Musk has already won the autonomous future. His constellation of companies and millions of cars on the road have amassed far more and diverse sets of data than any of its competitors, which could make Tesla's future combination of self-driving technology and AI unbeatable—and far more valuable.

Still, even if Tesla's data honey pot might put it in pole position, others say Tesla's future success is far from guaranteed. ‘I wish it was as simple as data in and driving out,” Alex Kendall, CEO of autonomous-driving startup Wayve, recently told Fortune’s Jeremy Kahn. “But there are so many other aspects to it.”

In other words: This race is still in its early laps.

Catch Up

Tesla

Elon Musk’s retreat from DOGE has lifted Tesla’s market cap by $158 billion—but the stock is still 50% off its December peak

by Shawn Tully

Trade and Tariffs

Surviving tariffs: 5 steps small businesses should take now

by Emma Burleigh

Leadership

Kohl’s CEO firing over ‘personal relationship’ makes a comeback harder to pull off

by Phil Wahba

Oil

‘Extraordinary volatility’. Tariffs are freezing energy M&A deals

Leadership

Turnaround chops. How Starbucks’ new CFO plans to help CEO Brian Niccol fix the company

Trade

Stockpile. U.S. businesses turn to customs bonded warehouses to wait out the tariff war

Join MPW as it goes global. Rt. Hon. Baroness Theresa May will discuss fractured trade ties, the race for a green economy, and the need for bold, creative leadership in a volatile world.

Request an invite here.

Fortune 500 C-suite Power Moves

Automatic Data Processing (No. 228) appointed Peter Hadley as the company’s new CFO, effective July 1. EBay (No. 390) appointed Peggy Alford as the company’s new CFO. World Kinect (No. 93) promoted John P. Rau to the formerly vacant role of COO.

And more in this week's Fortune 500 Power Moves.

Deals & Developments

Marriott International (No. 173) agreed to acquire CitizenM, a global network of hotels outfitted with smart technology and modern design, for $355 million. Marriott CEO Anthony Capuano said he believes adding CitizenM to the Marriott portfolio will bring another “unique, differentiated offering” for guests.
Conagra Brands (No. 336) agreed to divest its Chef Boyardee brand to Hometown Food Company, a portfolio company of Brynwood Partners, for $600 million. Conagra CEO Sean Connolly described the decision as a step toward “reshaping the Conagra Brands portfolio for better long-term growth.”
RPM International (No. 492) agreed to acquire Star Brands, the U.K.-based parent company of The Pink Stuff, a household cleaner that rose to success after going viral on social media. Star Brands will join Rust-Oleum, a subsidiary of RPM International that manufactures household coatings. The purchase adds another notable brand to Rust-Oleum’s long list of acquisitions, which includes products such as Roto Rooter and EpoxyShield. The financial terms of the deal were not disclosed.

Overheard

“It’s time to train people not to do the jobs of the past, but to do the great jobs of the future.”

—U.S. Secretary of Commerce Howard Lutnick says the “new model” for work is manufacturing.

In interviews with Fortune 500 CEOs:

Kraft Heinz (No. 156) CEO Carlos Abrams-Rivera said the consumer packaged goods company is focused on innovating, both by bringing new ideas to market and “renovating” its core products through package redesign. “That may not be the sexiest type of innovation, but it solves a pain point for families that are looking for value too, and a way of keeping them in our franchise for longer.”

On earnings calls:

Amazon (No. 2) CEO Andy Jassy expressed uncertainty around tariffs on the retailer’s first-quarter earnings call and said it's focused on keeping prices low for consumers. It beat analyst expectations, but a soft second-quarter guidance led to a sell-off in after-hours on Thursday.
Apple (No. 3) CEO Tim Cook said, if all else equal, tariffs would cost the company $900 million in the June quarter. Shares fell in after-hours trading despite first-quarter results being mostly in line with expectations.
CVS Health (No. 6) exceeded Wall Street’s expectations in its first-quarter earnings and announced a new deal with pharmaceutical manufacturer Novo Nordisk to sell weight loss drug Wegovy at a discount to CVS customers who pay cash.
Exxon Mobil (No. 7) and Chevron (No. 15) both maintained that they are undeterred by tariff uncertainty and won’t change their spending forecasts, despite the fact that both fuel giants reported a dip in earnings year over year. Exxon Mobil will enter arbitration later this month to argue against Chevron’s proposed $53 billion purchase of Hess (No. 378), which owns 30% of Exxon’s offshore oil project in Guyana.
Microsoft (No. 13) CFO Amy Hood