AMNA NAWAZ: Elon Musk says that he will scale back his time with DOGE and working for President Trump starting next month, and focusing more of his time on his company, Tesla.

John Yang has the details.

JOHN YANG: Amna, Musk made that announcement yesterday as Tesla reported that its profits plunged 71 percent in the first three months of the year and revenue from car sales dropped 20 percent.

On an earnings call, Musk defended his cost-cutting work in President Trump's Department of Government Efficiency, known as DOGE.

He claimed, without evidence, that protests and several Tesla dealerships are led by laid-off government workers.

ELON MUSK, Department of Government Efficiency: Now, the protests that you will see out there, they're very organized.

They're paid for.

They're obviously not going to say, admit that the reason that they're protesting is because they're receiving fraudulent money, or that they're the recipients of wasteful largess, but they're going to come up with some other reason.

But that is the real reason for the protests.

The actual reason is that those receiving the waste and fraud wish to continue receiving it.

JOHN YANG: Musk said he would still spend one or two days a week working for the administration.

Bobby Allyn is a technology correspondent for NPR who has covered Musk for many years.

Bobby, help us put this in perspective.

Is this just one bad quarter, or are there some warning signs here?

BOBBY ALLYN, Business and Technology Reporter, NPR: I think there are some real warning signs.

One thing that's really important to underscore with Musk is, this is not just one of his companies.

This is the largest source of Elon Musk's wealth, right?

He is the richest man in the world because of just how big and just how powerful Tesla is.

So when Tesla's sales are down, when Tesla's profits are plunging, it's not just bad for the carmaker.

It's bad for Elon's position in the world.

And what I think investors are seeing in this quarter, and it's one of the worst quarters Tesla has had in the company's history, is that people around the world are souring on what he is doing in the White House.

And abroad, especially in Europe, Germans are not so happy that he has become a vocal supporter of AfD, the anti-immigrant far right populist party in that country.

And if you look at sales in Germany since Elon has supported that party, they have really cratered.

So many thought, oh, Musk has ties to the White House, he is close to President Trump, this should lift the fortunes of Tesla are now seeing there's a bit of a backlash, and it's bringing down one of his most important companies.

JOHN YANG: The company seemed to acknowledge that.

In a letter to shareholders, they said that changing political sentiment could change demand for their cars.

Is this a permanent damage, or do you think this is transitory?

BOBBY ALLYN: Elon says it's very short-term.

But if you try to look out over the next 3.5 years, if the protests against Tesla are in part fueling this, as what many analysts are saying, and if there is a growing feeling that buying a Tesla is almost a tacit endorsement of the Trump administration, this is not a bad, troubling quarter for Tesla.

This could be a look into the future.

As long as Elon Musk stays hitched politically to the Trump administration, I think a lot of consumers are going to back off and say, I want to sell my Tesla.

I don't want to buy a Tesla.

That's in the U.S.. Abroad, you're seeing China.

There's a really bad situation for Tesla, because BYD, electric carmaker in China, is selling its vehicles.

The cheapest one is like $10,000.

I mean, the cheapest Tesla is four times that.

So he's facing growing competition in China.

There's a growing political backlash in the U.S. And I don't think this is a three-month quarterly beatdown for the company.

I think this could potentially mean troubling times ahead for the company.

JOHN YANG: You know, in the earnings call, he talked about or he said that the future of the company is based on autonomous cars and humanoid robots.

To what extent is he sort of turning away from carmaking?

BOBBY ALLYN: This is classic Elon Musk.

He likes getting investors excited about the future by making big, bold promises that he can't always deliver on.

And instead of putting the focus on carmakers, he really wants to emphasize robo-taxis, right?

He really wants to emphasize these Oculus robots that he thinks will replace factory workers many years down the road.

Again, Elon Musk is a very effective salesman.

He's very skilled at getting investors excited about his big ideas.

But when I have talked to analysts about whether these promises for robo-taxis and for factory robots are realistic, most are quite skeptical.

But, again, when you hear skepticism, when Elon Musk hears skepticism, this is what emboldens him.

This is what drives him.

He pulls off feats that many say are impossible all the time.

So we don't really know what's in store over the next couple years.

But, yes, he's putting the spotlight on things that are not core to his Tesla company, right, robots.

JOHN YANG: Despite all of this, Bobby, doesn't Tesla have some real strengths?

BOBBY ALLYN: It does.

I mean, Tesla is by far the strongest and most profitable electric vehicle company in the U.S.

I mean, even with these headwinds that Tesla is facing, it is so far ahead of the pack when it comes to the number of electric vehicle sales it's recording every year and just its underlying technology.

So, yes, there are some troubles for the company.

But in terms of the electric vehicle market, Tesla is way ahead of the game.

JOHN YANG: Bobby Allyn of NPR, thank you very much.

BOBBY ALLYN: Thanks for having me.