Elon Musk attends the premiere of ”Lola” held at the Regency Bruin Theatre in Los Angeles, California, U.S., February 3, 2024.
Aude Guerrucci | Reuters
Tesla plans to ask shareholders to reinstate CEO Elon Musk’s $56 billion pay package from 2018 after a Delaware court voided the record-setting stock grant earlier this year and described it as “deeply flawed.”
The company announced the move in a preliminary proxy filing Wednesday, just days after the company told employees it would cut headcount by 10%.
Tesla said the court decision created a “fundamental problem for the company”. As a result, Tesla also plans to ask shareholders to let the company move its state of incorporation from Delaware to Texas, something Musk had threatened to do in the aftermath of the unfavorable court ruling.
The two proposals are likely to be fiercely controversial. Tesla has hired a proxy solicitor, Innisfree M&A, and plans to spend an undetermined amount, in the millions, to help secure the votes for the two proposals, according to the filing.
Tesla has not hired Innisfree since 2018, when it first asked shareholders to vote on Musk’s pay package. Companies often only advertise the cost of proxy solicitations when major proposals or proxy fights are expected.
Musk’s pay package was mooted after a shareholder won a lawsuit against the company earlier this year. Delaware Chancery Court Chancellor Kathaleen McCormick found that Musk, rather than Tesla’s board, controlled the company and that the board’s compensation committee, rather than negotiating with Musk over the terms of the deal, “worked alongside him, almost as an advisory body.”
The Tornetta decision prompted Musk to say, “Never incorporate your company in the state of Delaware.”
Tesla, in its Wednesday filing, cast doubt on the decision from McCormick, who has been across some of Musk’s other legal dealings. “The Company and the Board believe that the decision in Tornetta ignored material evidence presented at trial and that the Delaware Court made errors of fact and incorrect conclusions of law,” Tesla said in the proxy filing.
The company also noted that “dozens of institutional stockholders” have told Tesla that they disagree with the Tornetta decision.
Delaware has long been a preferred home for corporations — more than 60% of the Fortune 500 are incorporated there — because the state has a robust legal framework and court system dedicated to resolving corporate issues, like executive pay, but also broader contract negotiations.
Tesla’s new proposal cautions shareholders that the Delaware court found their initial 2018 disclosures to be deficient, and urged them to read the full text of the decision.
In January, the same day the pay package was rejected, Musk asked his X followers if Tesla should re-incorporate in Texas. Months later, Tesla’s board is now asking shareholders to approve their answer to that question.
This is breaking news. Please check back for updates.
Thomas Fuller | SOPA Images | Lightrocket | Getty Images
Apple approved the Epic Games title Fortnite on Tuesday, returning the first-person shooter game to the App Store in the U.S., five years after its removal.
Fortnite was kicked off the App Store in 2020 after Epic updated its game over the web to take payments directly, instead of through Apple’s in-app payment mechanism, which takes fees up to 30%. The move angered Apple and kicked off a years-long legal battle.
Last month, Epic scored a victory in court, when a judge ruled that Apple wasn’t allowed to charge a commission when apps link out for payment, or dictate whether the links look like buttons. Epic said last week that it had submitted Fortnite to the U.S. App Store. To return, Fortnite had to pass App Review, Apple’s process in which new apps or updates are reviewed by Apple employees to ensure they work and adhere to the company’s guidelines.
Apple had dragged out its approval process for the app since May 9, when Epic submitted it to Apple. Last week, Epic filed a legal challenge, and on Monday, a judge said that Apple had to explain why Fortnite hadn’t been approved yet or come to a resolution with Epic over the game’s status.
Apple is appealing the latest court order, and looking to get a pause enabling it to roll back changes the company has already made to the App Store in response. An Apple representative didn’t immediately return a request for comment.
Last month’s ruling led major app makers such as Amazon and Spotify to change their apps to accommodate links to buy content. For example, users can now buy Kindle books inside the Kindle app on an iPhone.
Amazon and Spotify were able to update existing apps that had already been approved with changes enabled by last month’s order. After Epic sued Apple, the iPhone maker revoked Epic’s developer account in addition to booting Fortnite.
Epic was able to get a European developer account and now offers Fortnite in Europe through a third-party app store under the Digital Markets Act, which went into effect last year. IPhone users can also play Fortnite through cloud gaming services. But even in Europe, Apple tried to terminate Epic’s account before backing off, Epic said.
The fees that Apple takes from the App Store are an increasingly important part of Apple’s business. They’re reported in Apple’s Services business, which also includes advertising, AppleCare warranties, payments, and subscription offerings such as Apple TV+. Apple reported nearly $27 billion in services revenue during the March quarter.
A Waymo self-driving car, seen with a driver, stops at a red light outside the U.S. Capitol in Washington, D.C., on Friday, March 31, 2025.
Bill Clark | CQ-Roll Call, Inc. | Getty Images
Waymo co-CEO Tekedra Mawakana told CNBC on Tuesday that the Alphabet-owned ride-hailing company has reached 10 million trips, doubling in the past five months.
“These are all paid trips, and they represent people who are really integrating Waymo Driver into their everyday lives,” said Mawakana, speaking at the Google I/O developer conference. The 10 million figure includes rides in Austin, Los Angeles, San Francisco and the Phoenix area.
Waymo is delivering more than 250,000 paid robotaxi rides a week, Alphabet said in its April earnings report. On Monday, Waymo said it had won approval to expand its autonomous ride-hailing service to more parts of the San Francisco Bay Area, including San Jose.
The robotaxi company is part of Alphabet’s “Other Bets” unit. Revenue in the overall category fell 9% in the first quarter from a year earlier to $450 million, and operating loss grew from to $1.23 billion from $1.02 billion a year ago.
While those figures include a number of businesses, Mawakana confirmed that Waymo is not yet profitable but that the company is “super focused on building a sustainable business.”
“We’re proving out that it can be a profitable business,” she said. “There’s a path to profitability.”
Waymo faces potential competition from Tesla, which has promised to launch its robotaxi service in Austin next month. Tesla CEO Elon Musktold CNBC on Tuesday that the plan was still on track, and that the company will start with about 10 vehicles and rapidly expand to thousands if the debut goes well with no incidents.
Musk said Tesla aims to bring its robotaxis to Los Angeles and San Francisco following the planned Austin launch. He has previously claimed Tesla’s “generalized” approach to robotaxis is more ambitious than Waymo’s. Tesla primarily relies on camera-based systems and computer vision instead of using sophisticated sensors including lidar and radar in its vehicles.
Mawakana said that Waymo has taken what it views as the “safest path.”
“There’s probably a lot of ways it can be done, but we’re the only ones that have done it,” she said. “We’ve been doing it 24 hours a day for almost five years. And so to us, it’s really important to focus on safety, not focus on safety and then cost — not cost and then safety.”
Xreal said its Project Aura glasses will run Google Android XR.
Xreal
Xreal on Tuesday announced a set of so-called “extended reality” glasses that run Google’s Android XR software, as the companies look to take on Meta and Apple in a new arena.
The launch marks an early step from Alphabet‘s Google to become a major operating system for future virtual and augmented reality smart glasses and headsets, much like Android has turned into a default option for most smartphones.
Xreal, a Chinese company backed by Alibaba, calls its glasses Project Aura and describes them as a lightweight extended reality — or XR — product. XR is a broad term encompassing technologies that merge real and virtual worlds.
Android XR, Google’s operating system for these products, was launched last year and is infused with its AI assistant Gemini.
Samsung’s Project Moohan, a type of headset that looks to rival Apple’s $3,500 Vision Pro, was the first device announced that runs Android XR. Samsung plans to launch the hardware this year.
Xreal’s Project Aura is the second device announced that will operate on Android XR, and it is the first such device in the glasses format.
Few details have been released about the tech, which was announced at the Google I/O conference. Xreal said the glasses will have Qualcomm‘s Snapdragon XR chips, which are specially designed for these pieces of hardware.
Xreal also said the glasses will be “tethered,” meaning they will connect to another device to run. The company has not yet provided details on what the glasses will need to be linked to.
The startup has released previous products that have run its in-house operating system, featured its own chips and connected to its own second device. But Project Aura will now rely more heavily on Google’s software and on Qualcomm semiconductors.
The timeline and price of Project Aura were not immediately disclosed. Xreal will likely release a headset for developers to start experimenting and building apps first, then a consumer product at a later date.
For Google, the more devices that run Android XR, the more appealing it will be for developers to build apps for the operating system. A large part of any operating system’s success is the quality of apps available for users.
For Xreal, being an early partner with Google and working with Qualcomm will give it access to the latest technology in the XR space, as well as to marketing for its products.
Glasses also offer an alternative to bulky headsets. Tech giants including Apple and Meta see extended reality as a potential new paradigm in computing.