Tesla stock soars 14% after Elon Musk commits to affordable vehicle launch following Q1 earnings miss

• Tesla stock surged as much as 14% on Wednesday after the company reported 1st-quarter earnings.
• While the company badly missed analyst estimates, Elon Musk did commit to an affordable car.
• "We're updating our future vehicle lineup to accelerate the launch of our low-cost vehicles," Tesla said.

Tesla stock surged as much as 14% on Wednesday after the company reported a big first-quarter earnings miss but reiterated its plans to sell affordable vehicles.

Investors were concerned that Tesla was pivoting away from a low-cost vehicle to instead focus on its robotaxi ambitions following a report from Reuters earlier this month, but it appears the company is committed to both endeavors.

"We're updating our future vehicle lineup to accelerate the launch of our low-cost vehicles in a more capex-efficient way," Tesla vice president of vehicle engineering Lars Moravy said on the earnings call.

Here are the key numbers:

• Revenue: $21.3 billion, compared to analyst estimates of $22.3 billion
• Adjusted earnings per share: $0.45, compared to analyst estimates of $0.50
• Gross margin: 17.4%, compared to analyst estimates of 16.5%

Tesla said its new vehicles could come in early 2025, or as soon as later this year.

"We've updated our future vehicle lineup to accelerate the launch of new models ahead, previously mentioned start of production in the second half of 2025. So, we expect it to be more like early 2025, if not late this year. These new vehicles, including more affordable models, will use aspects of the next-generation platform as well as aspects of our current platforms," Tesla CEO Elon Musk said.

While Tesla committed to selling a low-cost vehicle, the company also said it is fully committed to building a robotaxi network. Musk said the company will unveil its "Cybercab" robotaxi in August.

And if investors aren't on board with the company's autonomous driving plans, they should jump ship, according to Musk.

"If you value Tesla as just like an auto company, you just have to, fundamentally, it's just the wrong framework and if you ask the wrong question, then the right answer is impossible. So, I mean, if somebody doesn't believe Tesla is going to solve autonomy, I think they should not be an investor in the company," Musk said.

Tesla also said it is in discussions with a major car manufacturer to license its full self-driving technology, similar to how it has struck licensing deals for its car charging technology and supercharger network. 

Wall Street analysts were mostly encouraged by Tesla's earnings call, especially after what has been a brutal year for the company with Tesla stock down more than 40% year-to-date going into the earnings call. 

"Last night in a much needed conference call Elon Musk finally stepped up as the adult in the room and laid the foundation for Tesla's growth strategy with most importantly a lower cost vehicle now slated for 2025 production and delivery," Wedbush analyst Dan Ives said. 

While Ives remained bullish on Tesla stock, he did lower his price target to $275 from $300.