Elon Musk just reopened one of his favorite long-time grudges, and, as usual, it was far from a whisper.
After the Gates Foundation dumped 65% of its Microsoft (MSFT) stake in Q3 (an estimated $8.8 billion gain), Musk jumped on X (formerly Twitter) to reignite his feud with Bill Gates on his longstanding short position against Tesla (TSLA).
“If Gates hasn’t fully closed out the crazy short position… he had better do so soon,” Musk wrote, pointing to a bet Gates has held for roughly eight years.
Tesla stock has been choppy, but it managed to eke out nearly a 19% gain over the past year. Musk seized on the moment to effectively remind everyone how badly the short position had aged.
Musk’s latest warning lands after the new Gates Foundation moves
Musk’s latest warning shot came after the Gates Foundation’s new 13F showed off a massive reduction in its Microsoft stake, along with a simultaneous unwinding of a wide range of legacy holdings.
Consequently, Musk jumped onto X to revive his longest-running grievances, calling Gates’ eight-year Tesla short “crazy.”
More Tesla:
- Tesla fatal crash lawsuit takes a wild turn
- Tesla: what must happen for the $1 trillion payout
- Tesla accused of not following key law
- Tesla has more bad news for Cybertruck lovers
It’s essential to note that this isn’t a completely new feud. Last year, Musk even warned that if Tesla became the most valuable company, the short position might “bankrupt” Gates’ philanthropic wealth.
For Musk, this isn’t just a simple trade. It’s also a clear bet against Tesla’s long-term mission, and evidence that high-profile shorts can significantly influence retail sentiment.
Gates Foundation Q3 moves:
- Trimmed Microsoft stake by 65%
- Exited UPS and Crown Castle
- Lowered positions in Berkshire Hathaway, Waste Management, and Caterpillar
- Sold shares of Canadian National Railway, Walmart, FedEx, Kraft Heinz
The $500 million bet that soured
The Musk-Gates feud wasn’t the usual social-media war, but it started with a massive, very real trade.
In 2022, Bill Gates had reportedly taken a colossal $500 million short position against Tesla, betting the business would fall in its attempts to scale as an EV giant. Instead, Tesla ripped higher, with reports pegging Gates’ loss at roughly $1.5 billion.
For Musk, this wasn’t just a tactical call; he framed it as “a massive bet on Tesla dying,” or essentially a wager against EV adoption itself.
Related: Palantir CEO Karp just settled major debate
Moreover, in Walter Isaacson’s biography and Musk’s own public comments, he continued to needle Gates for holding the short, even as Tesla ramped up production and became the EV behemoth that it is today.
For Musk, the timing of the move from Gates was deeply personal.
Heavy short interest back then would have likely spooked retail holders or potentially deepened dips when the company hit production roadblocks. On the flip side, Gates treated it clinically, a valuation bet on one of the most volatile stocks in history.
It’s noteworthy that Tesla stock has effectively been a magnet for short sellers. During its Model 3 “production hell,” roughly 20% of its shares were sold short, which made it one of the most shorted stocks in the U.S.
By 2018, over $13 billion had been wagered against it, which essentially set the stage for the massive 2019-2021 squeeze, during which Tesla quadrupled, and shorts ended up losing an estimated $40 billion in 2020 alone.
These days, though, its short interest is just 72 million shares, roughly 2.5% to 2.7% of the float, with days-to-cover under one.
Tesla’s worst year in a while still isn’t tempting short sellers
2025 essentially handed shorts the setup they had always dreamed about, but most of them are still steering clear.
Tesla’s first-half numbers came in remarkably rough from virtually every angle.
Q1 deliveries dropped 13% to 336,681, the weakest number in almost three years, as backlash to Musk’s politics, along with an aging lineup, caught up, backed by growing pressures from BYD, which ate into demand.
Related: Morgan Stanley revamps Nvidia’s price target ahead of big Q3
Revenue came in at $19.3 billion, nearly $2 billion light, while net income plummeted 71% to $409 million. Moreover, automotive sales tanked 20%, and almost $600 million in regulatory credits prevented Tesla from slipping into the deep end.
Q2 didn’t reverse the slide either, with deliveries falling another 14% to 384,000, while sales dropped 12% to $22.5 billion and profits hovered well below pre-slump levels.
Q3 finally delivered a headline pop with a record 497,099 deliveries, up 7% year over year, spearheaded by buyers racing to beat the U.S. EV tax credit deadline.
Yet underneath, the math still doesn’t add up with operating profit dropping 40% to $1.6 billion, while automotive sales rose only 6%. Analysts are now forecasting 1.6 million deliveries for 2025, approximately 10% lower than in 2024.
JPMorgan calls “unprecedented brand damage” linked to Musk’s explicit government involvement and far-right politics, which makes it Tesla’s toughest stretch since Model 3’s “production hell.”
Related: Ray Dalio’s Bridgewater quietly reshapes its portfolio amid bubble warnings
