Shares of Tesla were flat in premarket trading Thursday after the EV maker denied a Wall Street Journal report that its board was searching for a replacement for chief executive Elon Musk.

The report, citing comments from sources familiar with the discussions, said that Tesla’s board members reached out to several executive search firms to work on a formal process for finding the company’s next CEO. Shares of Tesla fell as much as 3% in overnight trading on trading platform Robinhood following the news, before paring losses.

Tesla chair Robyn Denholm wrote on the social media platform X that the report was “absolutely false.”

“Earlier today, there was a media report erroneously claiming that the Tesla Board had contacted recruitment firms to initiate a CEO search at the company,” she wrote.

“This is absolutely false (and this was communicated to the media before the report was published). 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.”

It comes after a sharp drop in the electric vehicle giant’s sales and profits, with its top and bottom lines missing estimates in the first quarter. Musk has admitted that his involvement with the Trump administration could be hurting the automaker’s stock price.

The mega-billionaire said on a Tesla earnings call last week that he plans to spend just a “day or two per week” running the so-called Department of Government Efficiency beginning in May.

Tesla’s total revenue slipped 9% year-on-year to hit $19.34 billion in the January-March quarter. This falls short of the $21.11 billion forecast by analysts, LSEG data shows.

Revenue from its automotive segment declined 20% year-on-year to $14 billion, as the company needed to update lines at its four vehicle factories to start making a refreshed version of its popular Model Y SUV. Tesla also attributed the decline to lower average selling prices and sales incentives as a drag on revenue and profit.

Its net income plunged 71% to $409 million, or 12 cents a share, from $1.39 billion or 41 cents a year ago.

Since the start of the year, its shares have plunged over 30%.

— CNBC’s Dan Mangan and Laura Kolodny contributed to this report.

Chinese online retailers have cut back their spending on Facebook and Instagram ads in reaction to President Donald Trump’s tough trade policy with the country.

Meta’s finance chief Susan Li said Wednesday that “Asia-based e-commerce exporters” have reduced their spending with the social media company. It’s likely those firms did so as they prepare for the de minimis trade loophole ending this Friday, Li said during a first-quarter earnings call.

“A portion of that spend has been redirected to other markets, but overall spend for those advertisers is below the levels prior to April,” Li said.

Trump in early April signed an executive order to end the de minimis trade exemptions for Chinese imports, which benefited online retailers like Temu and Shein. Analysts have said they believe that Temu and Shein make up the bulk of Meta’s 2024 China-related sales of $18.35 billion.

Meta’s advertising sales in the Asia-Pacific region were $8.22 billion for the first quarter, the company said. That was below Wall Street projections of $8.42 billion.

Li said that Meta’s second-quarter revenue would come in the range of $42.5 billion to $45.5 billion, which was in line with analysts expectations of $44.03 billion.

“It’s very early, hard to know how things will play out over the quarter, and certainly, harder to know that for the rest of the year,” Li said.

This echoes what Google said last week during its earnings call, warning that it expects headwinds to its advertising business, particularly from the Asia-Pacific region. Similarly, Snap on Tuesday said it had “experienced headwinds to start the current quarter.”

Trump’s China tariffs of 145% also appear to be impacting Meta’s Reality Labs unit, which creates virtual reality and augmented reality devices.

Reality Labs had an operating loss of $4.2 billion while bringing in $412 million in sales during the first quarter.

Meta said its 2025 capital expenditures will come in the range of $64 billion to $72 billion, which is higher than its prior outlook of $60 billion to $65 billion.

“This updated outlook reflects additional data center investments to support our artificial intelligence efforts as well as an increase in the expected cost of infrastructure hardware,” the company said in the earnings release.

Regarding the higher costs of infrastructure hardware, Li told analysts that it’s the result of “suppliers who source from countries around the world.” The higher cost of infrastructure hardware and “higher expected Reality Labs cost of goods sold” has “partially offset” Meta’s lowered projected range for its 2025 total expense, she said.

“There’s just a lot of uncertainty around this, given the ongoing trade discussions,” said Li, adding that Meta is modifying its supply chain as a result.

WATCH: Meta is showing tangible examples of AI investment.

President Trump’s tariffs have dominated global news headlines for weeks. During Microsoft‘s earnings call with investors on Wednesday, though, tariffs came up only once, during prepared remarks.

The reference from Amy Hood, Microsoft’s finance chief, had to do with sales of personal computers and Windows operating system licenses to other PC makers.

“Windows OEM and devices revenue increased 3% year over year, ahead of expectations, as tariff uncertainty through the quarter resulted in inventory levels that remained elevated,” Hood said.

While Microsoft does sell Surface PCs and Xbox video game consoles, impact will likely be less direct than it will be on companies that sell physical products.

Still, Microsoft does stand to see second-order effects, like other software vendors. Its clients might feel the effects of higher prices on goods imported into the U.S. and choose to soften their spending, and Microsoft does purchase equipment from other countries.

The Redmond, Washington-based company is investing heavily to buy and install the necessary Nvidia graphics processing units across the world to power OpenAI’s ChatGPT and other artificial intelligence products.

If anything, software might help companies respond in the event that their costs go up because of tariffs, CEO Satya Nadella said on the conference call

“I think if you sort of buy into the argument that software is the most malleable resource we have to fight any type of inflationary pressure or any type of growth pressure where you need to do more with less, I think we can be super helpful in that,” he said. “And so if anything, we would probably have more of that mindset is, how do we make sure we are helping our customers, and then, of course, we’ll look to
share gains.”

The company sells a slew of AI products, including the GitHub Copilot that spits out source code suggestions for developers and the Microsoft 365 Copilot assistant that answers questions in Excel, Teams and other productivity apps.

Microsoft shares traded up about 8% in extended trading after the call. The company reported higher revenue and earnings than analysts had predicted and issued an upbeat forecast.

WATCH: Corporate margins will be pressured as a results of tariffs, says Morgan Stanley’s Guerra