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Elon Musk, CEO of Tesla and X, speaks at the Atreju political convention organized by Fratelli d’Italia (Brothers of Italy), in Rome, Dec. 15, 2023.

Antonio Masiello | Getty Images

Two weeks after a Delaware court ruled that Tesla must rescind Elon Musk’s $56 billion pay package, the company’s board remains mum on what the decision means for shareholders or what’s next for the mercurial CEO.

In her 200-page opinion on Jan. 30, Chancellor Kathaleen McCormick called the pay plan the largest in public corporate history, and said it was agreed upon by people “who were beholden to Musk.” Since then, Musk has lashed out at the court, posted “Never incorporate your company in the state of Delaware” on his social media platform X, and said Tesla would hold a shareholder vote to move its site of incorporation to Texas.

Tesla hasn’t yet issued an SEC filing to notify shareholders of the ruling.

The decision came shortly after Musk indicated that he’s pushing for even more control of Tesla, posting on X in mid-January that he wanted roughly 25% voting control before turning the company into a leader in artificial intelligence and robotics. Musk is already building an AI company called xAI outside of Tesla.

The next step in the compensation case is an “implementing order” that will be hashed out between the court, Musk’s team and the lawyers representing shareholder Richard Tornetta, a former heavy metal drummer who was the plaintiff in the 2018 lawsuit filed on behalf of all Tesla investors.

As shareholders await answers, Tesla’s eight-person board, which includes Musk, his brother Kimbal, Chairwoman Robyn Denholm and former Tesla technology chief JB Straubel, has stayed silent, avoiding any public comments.

CNBC sent requests for additional information to Tesla investor relations, Musk and some board members. They all went unanswered.

Musk's future at Tesla under scrutiny

Greg Varallo, who was lead counsel for Tornetta and is head of the Delaware office of Bernstein Litowitz Berger & Grossmann, told CNBC that theoretically Musk and his legal team could still pursue a last-minute settlement. While Varallo said he has no knowledge of Musk’s plans, he said he expects Musk to appeal the decision to the Delaware state Supreme Court.

“I’d give you very high odds on that,” Varallo said.

Kobi Kastiel, a law professor at Tel Aviv University, also predicts that Musk will appeal the ruling. Kastiel wasn’t involved in the litigation but he co-authored a 2023 paper in the Washington University Law Review titled “Superstar CEOs and Corporate Law” that was cited in McCormick’s ruling.

“Given the high stakes involved, it is likely that Tesla will appeal the decision,” Kastiel said in an email. In the absence of a successful appeal, “any new compensation arrangement with him will have to be assessed” in light of McCormick’s decision, Kastiel said.

‘Bunch of options would be returned’

In the 2018 CEO compensation plan, Tesla’s board awarded Musk a dozen tranches of stock options that would finish vesting in 2022 and were based on milestones, including many focused on stock price increases.

Between the beginning of 2018 and the end of 2022, Tesla shares soared almost 500% as Musk promised to turn Tesla into not just a dominant EV brand, but a robotaxi company and solar juggernaut, among other things. The S&P 500 gained 44% over that stretch, while the Nasdaq rose 52%.

Eric Talley, a professor at Columbia Law School, told CNBC that, should the ruling stand, Musk will lose his options but not any shares he previously held. The move would decrease the number of shares outstanding, potentially bolstering the value of each share held by investors.

“A bunch of options would be returned to Tesla’s coffers, which is hugely accretive to stock value,” said Talley, who wasn’t involved in the case. On the other hand, Talley pointed out, “Tesla has a very grumpy CEO who might want to take his ball and go home. Thus far, trading suggests those two factors have been a wash.”

Tesla shares are down slightly since the Delaware court’s decision in late January. They’re down close to 25% for the year, while major indexes are up.

Musk voiced a strong preference for moving his businesses out of Delaware following the court’s decision, and encouraged others to do so as well.

He moved the incorporation location for his brain computer interface company, Neuralink, from Delaware to Nevada, filings revealed last week. He’s also been a big proponent of Texas in recent years, personally relocating there from California, and building massive complexes for SpaceX and Tesla in the state, which has no personal income taxes and a much lower business tax rate.

Author Walter Isaacson, who published a 688-page biography on Musk last year, told CNBC’s “Squawk Box” on Monday that if the ruling doesn’t get overturned, “it’s going to hurt Delaware.”

“People will say, ‘Wait, wait, you mean five years after something happens, eight years after something happens, you’ll go back and undo it?'” Isaacson said.

Tulane Law School professor Ann Lipton had a different take.

Tulane Law professor Ann Lipton on Elon Musk's pay package, legal impact of Tesla's move to Texas

“It’s a very thorough opinion and the Supreme Court should give great deference to the factual findings of the trial court,” Lipton said.

In terms of what shareholders should ask of Tesla’s board now, Kastiel said, “Tornetta and recent media reports on Musk have emphasized the importance of accurate and detailed disclosure of the ties between controlling shareholders and directors.”

There’s a more fundamental concern at play, Kastiel said, regarding corporate governance in cases where a “superstar CEO” is running the show.

“As long as the CEO is perceived as a star and the company depends on the CEO’s vision and leadership, even nominally independent directors — those without strong ties to the CEO — will have difficulty monitoring the CEO’s conduct,” he said.

Kastiel also said that the decision likely makes Musk and Tesla more vulnerable to other types of lawsuits.

“Plaintiffs may have a better chance of advancing their claims by potentially leveraging the Tornetta findings to argue that the majority of the Tesla board is not independent of Musk,” he said. “To mitigate this risk, Tesla will need to significantly enhance the independence of its board and nominate new independent directors who do not have strong ties to Musk.”

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Elon Musk’s X temporarily down for tens of thousands of users

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Elon Musk's X temporarily down for tens of thousands of users

Elon Musk looks on as U.S. President Donald Trump meets South African President Cyril Ramaphosa in the Oval Office of the White House in Washington, D.C., U.S., May 21, 2025.

Kevin Lamarque | Reuters

The Elon Musk-owned social media platform X experienced a brief outage on Saturday morning, with tens of thousands of users reportedly unable to use the site.

About 25,000 users reported issues with the platform, according to the analytics platform Downdetector, which gathers data from users to monitor issues with various platforms.

Roughly 21,000 users reported issues just after 8:30 a.m. ET, per the analytics platform.

The issues appeared to be largely resolved by around 9:55 a.m., when about 2,000 users were reporting issues with the platform.

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X did not immediately respond to CNBC’s request for comment. Additional information on the outage was not available.

Musk, the billionaire owner of SpaceX and Tesla, acquired X, formerly known as Twitter in 2022.

The site has had a number of widespread outages since the acquisition.

The site experienced another outage in March, which Musk attributed at the time to a “massive cyberattack.”

“We get attacked every day, but this was done with a lot of resources,” Musk wrote in a post at the time.

This is breaking news. Check back for updates

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Companies turn to AI to navigate Trump tariff turbulence

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Companies turn to AI to navigate Trump tariff turbulence

Artificial intelligence robot looking at futuristic digital data display.

Yuichiro Chino | Moment | Getty Images

Businesses are turning to artificial intelligence tools to help them navigate real-world turbulence in global trade.

Several tech firms told CNBC say they’re deploying the nascent technology to visualize businesses’ global supply chains — from the materials that are used to form products, to where those goods are being shipped from — and understand how they’re affected by U.S. President Donald Trump’s reciprocal tariffs.

Last week, Salesforce said it had developed a new import specialist AI agent that can “instantly process changes for all 20,000 product categories in the U.S. customs system and then take action on them” as needed, to help navigate changes to tariff systems.

Engineers at the U.S. software giant used the Harmonized Tariff Schedule, a 4,400-page document of tariffs on goods imported to the U.S., to inform answers generated by the agent.

“The sheer pace and complexity of global tariff changes make it nearly impossible for most businesses to keep up manually,” Eric Loeb, executive vice president of government affairs at Salesforce, told CNBC. “In the past, companies might have relied on small teams of in-house experts to keep pace.”

Firms say that AI systems are enabling them to take decisions on adjustments to their global supply chains much faster.

Andrew Bell, chief product officer of supply chain management software firm Kinaxis, said that manufacturers and distributors looking to inform their response to tariffs are using his firm’s machine learning technology to assess their products and the materials that go into them, as well as external signals like news articles and macroeconomic data.

“With that information, we can start doing some of those simulations of, here is a particular part that is in your build material that has a significant tariff. If you switched to using this other part instead, what would the impact be overall?” Bell told CNBC.

‘AI’s moment to shine’

Trump’s tariffs list — which covers dozens of countries — has forced companies to rethink their supply chains and pricing, with the likes of Walmart and Nike already raising prices on some products. The U.S. imported about $3.3 trillion of goods in 2024, according to census data.

Uncertainty from the U.S. tariff measures “actually probably presents AI’s moment to shine,” Zack Kass, a futurist and former head of OpenAI’s go-to-market strategy, told CNBC’s Silvia Amaro at the Ambrosetti Forum in Italy last month.

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“If you wonder how hard things could get without AI vis-a-vis automation, and what would happen in a world where you can’t just employ a bunch of people overnight, AI presents this alternative proposal,” he added.

Nagendra Bandaru, managing partner and global head of technology services at Indian IT giant Wipro, said clients are using the company’s agentic AI solutions “to pivot supplier strategies, adjust trade lanes, and manage duty exposure dynamically as policy landscapes evolve.”

Wipro says it uses a range of AI systems — both proprietary and supplied by third parties — from large language models to traditional machine learning and computer vision techniques to inspect physical assets in cross-border transit.

‘Not a silver bullet’

While it preferred to keep company names confidential, Wipro said that firms using its AI products to navigate Trump’s tariffs range from a Fortune 500 electronics manufacturer with factories in Asia to an automotive parts supplier exporting to Europe and North America.

“AI is a powerful enabler — but not a silver bullet,” Bandaru told CNBC. “It doesn’t replace trade policy strategy, it enhances it by transforming global trade from a reactive challenge into a proactive, data-driven advantage.”

AI was already a key investment priority for global firms prior to Trump’s sweeping tariff announcements on April. Nearly three-quarters of business leaders ranked AI and generative AI in their top three technologies for investment in 2025, according to a report by Capgemini published in January.

“There are a number of ways AI can assist companies dealing with the tariffs and resulting uncertainty.  But any AI solution’s success will be predicated on the quality of the data it has access to,” Ajay Agarwal, partner at Bain Capital Ventures, told CNBC.

The venture capitalist said that one of his portfolio companies, FourKites, uses supply chain network data with AI to help firms understand the logistics impacts of adjusting suppliers due to tariffs.

“They are working with a number of Fortune 500 companies to leverage their agents for freight and ocean to provide this level of visibility and intelligence,” Agarwal said.

“Switching suppliers may reduce tariffs costs, but might increase lead times and transportation costs,” he added. “In addition, the volatility of the tariffs [has] severely impacted the rates and capacity available in both the ocean and the domestic freight networks.”

WATCH: Former OpenAI exec says tariffs ‘present AI’s moment to shine’

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Amazon’s Zoox robotaxi unit issues second software recall in a month after San Francisco crash

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Amazon's Zoox robotaxi unit issues second software recall in a month after San Francisco crash

A Zoox autonomous robotaxi in San Francisco, California, US, on Wednesday, Dec. 4, 2024.

David Paul Morris | Bloomberg | Getty Images

Amazon‘s Zoox robotaxi unit issued a voluntary recall of its software for the second time in a month following a recent crash in San Francisco.

On May 8, an unoccupied Zoox robotaxi was turning at low speed when it was struck by an electric scooter rider after braking to yield at an intersection. The person on the scooter declined medical attention after sustaining minor injuries as a result of the collision, Zoox said.

“The Zoox vehicle was stopped at the time of contact,” the company said in a blog post. “The e-scooterist fell to the ground directly next to the vehicle. The robotaxi then began to move and stopped after completing the turn, but did not make further contact with the e-scooterist.”

Zoox said it submitted a voluntary software recall report to the National Highway Traffic Safety Administration on Thursday.

A Zoox spokesperson said the notice should be published on the NHTSA website early next week. The recall affected 270 vehicles, the spokesperson said.

The NHTSA said in a statement it had received the recall notice and that the agency “advises road users to be cautious in the vicinity of vehicles because drivers may incorrectly predict the travel path of a cyclist or scooter rider or come to an unexpected stop.”

If an autonomous vehicle continues to move after contact with any nearby vulnerable road user, it risks causing harm or further harm. In the AV industry, General Motors-backed Cruise exited the robotaxi business after a collision in which one of its vehicles injured a pedestrian who had been struck by a human-driven car and was then rolled over by the Cruise AV.

Zoox’s May incident comes roughly two weeks after the company announced a separate voluntary software recall following a recent Las Vegas crash. In that incident, an unoccupied Zoox robotaxi collided with a passenger vehicle, resulting in minor damage to both vehicles.

The company issued a software recall for 270 of its robotaxis in order to address a defect with its automated driving system that could cause it to inaccurately predict the movement of another car, increasing the “risk of a crash.”

Amazon acquired Zoox in 2020 for more than $1 billion, announcing at the time that the deal would help bring the self-driving technology company’s “vision for autonomous ride-hailing to reality.”

While Zoox is in a testing and development stage with its AVs on public roads in the U.S., Alphabet’s Waymo is already operating commercial, driverless ride-hailing services in Phoenix, San Francisco, Los Angeles and Austin, Texas, and is ramping up in Atlanta.

Tesla is promising it will launch its long-delayed robotaxis in Austin next month, and, if all goes well, plans to expand after that to San Francisco, Los Angeles and San Antonio, Texas.

— CNBC’s Lora Kolodny contributed to this report.

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