Tesla’s earnings miss, Meta job cuts, U.S. sanctions Russian oil and more in Morning Squawk

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Here are five key things investors need to know to start the trading day:

All eyes were on Tesla yesterday, when the electric vehicle maker became the first Magnificent Seven company to report earnings for the new season. Investors weren’t impressed: Though quarterly revenue was higher than a year ago, snapping two down quarters, earnings per share came in below Wall Street’s expectations amid rising capital expenditures.

Here’s what happened on the earnings call:

• CEO Elon Musk and other executives offered little forward guidance or insight into the auto business. Instead, the focus was on Tesla’s work in Robotaxis and Optimus humanoid robots, CNBC’s Lora Kolodny reports.
• Musk also discussed the company’s expected artificial intelligence chip, but acknowledged that Tesla is “not about to replace Nvidia.”
• Heading into the report, a group of unions and watchdogs launched the “Take Back Tesla” campaign to urge investors to oppose Musk’s new compensation plan. The highly publicized pay package would give the billionaire entrepreneur an opportunity to rake in almost $1 trillion in stock.
• Musk addressed the pay plan at the end of the earnings call, calling proxy advisors who oppose the package “corporate terrorists.”
• “If we build this robot army, do I have at least a strong influence over that robot army?” Musk said on the call. “I don’t feel comfortable building that robot army if I don’t have at least a strong influence.”
• Tesla shares fell more than 3% in premarket trading this morning. Follow live markets updates here.

On the other hand, Southwest Airlines beat expectations on both lines. Of note: The Dallas-based carrier posted a profit for earnings per share, while the Street had penciled in a loss. Still, shares are more than 1% lower before the bell this morning.

American Airlines also reported better earnings than analysts forecasted and gave an upbeat outlook for the remainder of the year. Shares rose nearly 4% following the release.

Next up on airline investors’ agendas: Alaska earnings due after the bell today.

The White House yesterday placed more sanctions on Rosneft and Lukoil — Russia’s two largest crude oil companies. Oil prices surged as a result, with the global benchmark Brent jumping more than 5%.

The Treasury Department cited Russia’s “lack of serious commitment to a peace process to end the war in Ukraine.” Treasury Secretary Scott Bessent warned that the Treasury could take “further action if necessary.”

These sanctions are related to plans for a meeting between President Donald Trump and Russian leader Vladimir Putin falling through, a senior White House official told NBC News.

While many tech companies race to hire AI talent, Meta appeared to take the opposite approach yesterday.

The Facebook parent is cutting around 600 roles from its AI business, which people familiar with the matter described to CNBC as bloated. No one from TBD Labs — the division that includes many of Meta’s major AI hires this summer — is on the chopping block, the people said.

Meanwhile, several big names in technology are calling for a pause on one form of AI development called “Superintelligence.” As CNBC’s Dylan Butts notes, the buzzy term refers to a hypothetical form of AI that would essentially outperform humans on basically everything. Signatories of the statement calling for a pause included Virgin Group founder Richard Branson and Apple cofounder Steve Wozniak.

Breaking news this morning: The Starbucks Workers United union will start voting tomorrow on whether to authorize a strike. The group also said it will also organize rallies and pickets across the country with member baristas and their allies.

The union and Starbucks are not currently in negotiations over a contract after talks broke down late last year, CNBC’s Kate Rogers reports. The union said it wants higher pay, improved hours and resolutions on outstanding labor disputes. A Starbucks spokesperson told CNBC that the union “chose to walk away from the bargaining table. If they’re ready to come back, we’re ready to talk.”

Starbucks is slated to report earnings next week.