Good morning, investors. Like we never left, the Nasdaq Composite and S&P 500 both hit a new record high on Wednesday despite the rocky start to the week.

The Dow, too, is inches away from exiting correction territory in another sign that optimism is building across the market.

But, of course, all that momentum couldn’t outshine Tesla’s breaking news.

Tesla beat expectations on profits and Elon Musk spent the earnings call talking about a much bigger spend ahead.

Automotive gross margin excluding credits climbed to 19.2% for its strongest print in over a year, though still short of the 26.5% peak Tesla hit in 2021.

The quarter included one-time warranty and tariff benefits that Tesla disclosed without dollar figures, so the underlying margin lift is real but harder to size than the headline suggests.

Meanwhile, car deliveries came in at 358,023, below estimates for 365,645.

Tesla flagged its highest order backlog in over two years and said it views the gap as demand to clear, not inventory overhang.

None of that was the part of the call Musk wanted investors focused on.

"We're going to be substantially increasing our investments in the future," Musk said Tuesday evening. "So [we] should expect to see a significant, very significant increase in capital expenditures."

Capex is guided above $20 billion for 2026 to fund six factories, AI infrastructure, Robotaxi, Optimus and a new research semiconductor fab in Austin.

First-quarter free cash flow came in at a positive $1.44 billion, though the spending ramp is set to pull the rest-of-year trajectory lower.

Musk had more to say on Tesla’s humanoid AI product, Optimus.

"Optimus will be our biggest product,” Musk said. “Not just Tesla's biggest product ever, but probably the biggest product ever."

Wedbush's Dan Ives called Tesla "now more an AI company than a car company" on CNBC after the earnings release, reiterating a $600 price target, while Morgan Stanley held at $425.

Tesla stock saw volatile trading in the overnight session, hovering near $387 a share.

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🚀 Boeing stock rallied after a stronger-than-expected quarter. The airliner reported first-quarter revenue of $22.2 billion and a core loss of 20 cents a share, beating expectations. (Yahoo Finance)

🛢 Oil stayed near $100 despite Trump extending the Iran ceasefire. Brent traded around $98 and WTI near $89 after Iran's Revolutionary Guard said it seized two container ships in the Strait of Hormuz, keeping supply-shock risk on the table. (CNBC)

📊 Google is developing next-gen TPUs in a direct shot at Nvidia. The chips deliver far better training performance versus the prior line, and Meta and every US Energy Department national lab are already using Google silicon for inference workloads. (Yahoo Finance)

I sat down with Baird investment strategist Ross Mayfield to unpack how the S&P 500 industrials sector has turned into one of the winners of the AI boom. We also discussed the corners of the market he’s most bearish on, and whether the software sell-off has been overblown.

Tune in Spotify, Apple Podcasts, or YouTube (and please leave a review if you enjoy the show!).

🗓 April 23, 1985: Coca-Cola scrapped its 99-year-old formula and introduced New Coke, sparking one of the widest consumer backlashes in market history. The company reversed course within 79 days.

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