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The Tesla CEO says a share buyback would depend on the severity of any recession

Elon Musk pledged to pause selling shares in Tesla Inc. TSLA -8.88% and said that a decision on a buyback of the company’s stock could be influenced by the severity of any economic downturn as he tried to ease concerns his purchase of Twitter was to the detriment of the electric-vehicle maker.

Mr. Musk, on a Twitter Spaces call Thursday, signaled he would not sell any Tesla stock for a minimum of 18 months to 24 months. The chief executive has liquidated more than $39 billion in the company’s shares since the stock peaked in November 2021.

“You certainly have my commitment I won’t sell stock until, I don’t know, probably two years from now. Definitely not next year under any circumstances and probably not the year thereafter,” he said. Mr. Musk has pledged not to sell Tesla shares before only to resume doing so.

The billionaire’s comments on the Twitter Spaces forum were some of his most expansive to address worries among Tesla investors that he has been distracted since he bought Twitter Inc. in October in a deal valued at $44 billion. Tesla’s stock has plunged 60% this year, performing worse than the wider market.

Some of Mr. Musk’s handling of Twitter and his political comments on the platform have spurred concern Tesla’s brand could suffer. The company’s image has taken a dent in recent months, in part because of Mr. Musk’s Twitter involvement, according to brand surveys.

Mr. Musk said that he wouldn’t muzzle himself on Twitter. “I’m not gonna suppress my views just to boost the stock price,” he said on the Twitter Spaces call.

Mr. Musk said he couldn’t think of a Tesla issue he didn’t deal with in recent weeks because he was busy at Twitter. “I had to have a sort of short-term, month-or-so if just getting the insane Twitter costs under control or Twitter would have just gone bankrupt,” he said. He added “that is basically almost entirely done” with some more engineering work left to be accomplished. Mr. Musk this week suggested once again he may step down as Twitter CEO if he could find a suitable replacement.

The Tesla boss also tried to strike an upbeat note about the car company’s long-term prospects even as concerns have been growing that demand for its vehicles is softening. Tesla is offering rare discounts for buyers to take delivery of vehicles before year-end.

“There is stormy weather ahead, but then there is going to be sunshine thereafter,” Mr. Musk said. He said near-term department pressures were driven by rising interest rates.

The economic turbulence could impact some of Tesla’s plans, he suggested. “Are we talking about a mild recession, a moderate recession, a severe recession? We don’t know yet,” Mr. Musk said.

In October, Mr. Musk said Tesla could pursue a share buyback of $5 billion to $10 billion and said a meaningful buyback was likely. The company has discussed such a share repurchase at the board level, he said, but hasn’t signed off on it.

“The board is very open to doing a buyback,” Mr. Musk said in a live conversation broadcast on Twitter, though he added, “It wouldn’t be smart to do a buyback and then discover the recession is worse than 2009.”

The Tesla boss also said the car company would continue to invest as part of its growth plans. “We are applying capital at pretty close to the fastest rate we can spend capital and not be wasteful,” he said.

The company, he said, is “close to picking a location for another Gigafactory,” without providing details. Mr. Musk has said Tesla might open 10 to 12 new factories to help boost Tesla output to 20 million vehicles at the end of the decade.

He said Tesla also planned to start refining battery-grade lithium at a facility in Corpus Christi, Texas, in about two years to help the electric-vehicle maker satisfy its need for material needed for power cells.

Amid investor concerns about Tesla—the company’s stock fell 8.88% on Thursday—Mr. Musk said, “The actual execution of the company is outstanding.” Tesla shares advanced more than 2% in aftermarket trading after Mr. Musk said he would pause selling shares.

Write to Robert Wall at robert.wall@wsj.com

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Long-held duopoly that rules the $300bn market is hit by growing competition from Amazon, Microsoft and Apple

Meta and Alphabet have lost their dominance over the digital advertising market they have ruled for years, as the duopoly is hit by fast-growing competition from rivals Amazon, TikTok, Microsoft and Apple.

The share of US ad revenues held by Facebook’s parent Meta and Google owner Alphabet is projected to fall by 2.5 percentage points to 48.4 per cent this year, the first time the two groups will not hold a majority share of the market since 2014, according to research group Insider Intelligence.

This will mark the fifth consecutive annual decline for the duopoly, whose share of the market has fallen from a peak of 54.7 per cent in 2017 and is forecast to decline to 43.9 per cent by 2024. Worldwide, Meta and Alphabet’s share declined 1 percentage point to 49.5 per cent this year.

Jerry Dischler, head of ads at Google, told the Financial Times that fierce rivalry from new entrants reflects an “extremely dynamic ad market”.

Regulators in the US and Europe have added antitrust scrutiny such as pursuing Google for allegedly promoting its products over rivals. In December, Facebook owner Meta was served with a complaint from the EU’s watchdogs over concerns that the social network’s classified advert service is unfair to rivals.

Tech groups are fighting harder than ever for a share of the $300bn digital ads market, even as companies worldwide are cutting their ad budgets in response to rising interest rates and high inflation.

Amazon and Apple have expanded their advertising teams. In July, Netflix announced it would partner with Microsoft to build an advertisement-supported tier of its streaming service.

Meta chief executive Mark Zuckerberg has blamed recent revenue falls on Apple’s privacy changes that make it harder to track users and target advertising, as well as the growing popularity of viral videos app TikTok, owned by Chinese parent ByteDance.

“Four years ago, you wouldn’t be talking about either [TikTok or Amazon] in advertising,” said Dischler. “So it’s really telling that more and more people are acknowledging that advertising is a great and scalable business model.”

Amazon’s foray into the digital ads world has played a big part in hitting Meta and Google’s dominance. After years of toying in the market, it ramped efforts up in 2015 and has since seen ad revenues skyrocket from less than $1bn to an estimated $38bn this year.

“Before I joined, I didn’t even know what Amazon Ads was,” said an Amazon executive who says they now run “a massive team — and I didn’t know this existed before the recruiter called”.

Paul Prior, chief operating officer of Undertone, a digital advertising company, said retail giants led by Amazon woke up to the realisation that their extensive data on customers could be the basis for a massive advertising business with higher margins than the sale of goods online.

But Amazon then went a step further, expanding its on-site ads business beyond its own shopping site. “Across the wider digital universe, they use that data set to empower brands and the advertisers to buy better, to spend more effectively and drive return on ad-spend,” said Prior.

Apple has also emerged as a new threat. Its ad revenues have grown from under $2.2bn in 2018 to more than $7bn this year. Although that is just 1.2 per cent of the global market, it is already more than Snapchat and Pinterest combined, and some estimates suggest Apple could reach $30bn of ad revenue by 2026.

In September, the FT revealed that the iPhone maker plans to nearly double the workforce in its fast-growing digital advertising business. Its job ads describe ambitions of “redefining advertising” for a “privacy-centric” world.

Zuckerberg has repeatedly hit out at Apple’s “conflict of interest”, criticising it of charging “monopoly rents” and stifling innovation. Apple’s privacy rules have made it difficult for Meta to tailor ads to people, contributing to its shares falling by about two-thirds over the past 15 months.

Google does not appear to have seen as much impact from Apple’s privacy changes, as it can tailor ads directly to users typing in search terms — giving it valuable “user intent” data that Meta struggles to attain.

But Apple already has its own Google Maps rival, a search function on the iPhone, and it is building a nascent ads business — which analysts say could take on Google in future.

“Apple has a really strong brand that consumers trust and they have the devices that are used by the cream of the consumer crop,” said Josh Koenig, chief strategy officer at Pantheon, a digital marketing platform. “If they can figure out how to turn that into a real valuable network for advertisers, they’ll be able to charge a premium.”

Insider Intelligence has forecast that Google and Meta’s US ad growth in 2023 will be just 3 per cent and 5 per cent, respectively, while at least eight of its rivals are to experience double-digit gains.

It estimates that Amazon’s ads business will rise by 19 per cent, Apple 26 per cent, Spotify 30 per cent, TikTok 36 per cent and Walmart 42 per cent. However, many of these groups’ market shares are currently small.

Dischler said Google was working hard on expanding its ads business in both ecommerce — where it is partnering with retailers — as well as in privacy-first advertising, where he argues Google can play a bigger role than Apple.

“I very much don’t see it as a zero-sum game,” said Dischler. “If Uber has an ad network — billboards on cars that previously didn’t have billboards, and is providing advertising opportunities when you’re getting groceries or food through restaurants — then they’re making the pie bigger.”

Software giant files documents opposing claims that transaction would harm competition in videogame industry

Microsoft Corp. MSFT -2.55% has filed a rebuttal to a Federal Trade Commission lawsuit aimed at blocking the software giant’s $75 billion purchase of Activision Blizzard Inc., ATVI -0.25% saying the deal will not hurt competition in the videogaming industry.

The software giant said in its defense of the deal that it is not the videogame industry’s top console company or software developer and its acquisition is aimed at becoming more competitive through its Xbox videogaming unit.

“Xbox wants to grow its presence in mobile gaming, and three quarters of Activision’s gamers and more than a third of its revenues come from mobile offerings,” Microsoft said in its response to the FTC lawsuit. “Xbox also believes it is good business to make Activision’s limited portfolio of popular games more accessible to consumers, by putting them on more platforms and making them more affordable.”

Microsoft had signaled it would challenge the antitrust regulator’s case after arguing for months the transaction wouldn’t harm competition in the videogame industry. It offered concessions to the FTC before the lawsuit was filed in a failed attempt to head off a legal battle.

In its suit, the FTC alleged that the acquisition would be illegal because it would give Microsoft the ability to control how consumers access Activision’s games beyond the Redmond, Wash., company’s own Xbox consoles and subscription services. Microsoft could raise prices or degrade Activision’s content for people who don’t use its hardware to access the developer’s games, or even cut off access to the games, the FTC said.

Microsoft has said it wouldn’t engage in such actions and that it needs Activision’s hit franchises such as “Call of Duty” and “Candy Crush” because it trails its rivals in console sales and has a limited presence in mobile-game development. The company, which values the deal at $68.7 billion after adjusting for Activision’s net cash, has also said it expects the industry to get more competitive with the rise of cloud gaming.

The FTC said Thursday that it will stand by its case.

“This $69 billion acquisition would give Microsoft the means to harm competition in multiple fast-growing gaming markets,” said John Newman, deputy director of the FTC’s bureau of competition in a statement. “We are confident in our case and look forward to presenting it at trial.”

A few days before the FTC sued Microsoft, the company offered to keep “Call of Duty” games accessible to rivals such as PlayStation maker Sony Group Corp. through a legally binding consent decree, augmenting a pledge it had made months earlier to keep them accessible for at least 10 years.

“The acquisition of a single game by the third-place console manufacturer cannot upend a highly competitive industry,” Microsoft said in its response. “That is particularly so when the manufacturer has made clear it will not withhold the game.”

European Union and U.K. regulators are also probing the deal, which Microsoft announced nearly a year ago. It has gained approval in some markets, such as Brazil and Saudi Arabia.

On Wednesday, the U.K.’s Competition and Markets Authority said it received an overwhelming majority of emails from the public in favor of the transaction after requesting people’s input between Oct. 14 and Oct. 28. The antitrust watchdog said about three quarters of 2,100 responses it received were in support of the transaction and about one quarter were opposed.

Microsoft’s battle with U.S. regulators is scheduled to take place in the FTC’s administrative court in August, unless a settlement is reached before then. The company has said it would prefer an amicable resolution.

“Even with confidence in our case, we remain committed to creative solutions with regulators that will protect competition, consumers and workers in the tech sector,” Microsoft President Brad Smith said.

Activision CEO Bobby Kotick defended the deal in a separate statement. “There is no sensible, legitimate reason for our transaction to be prevented from closing,” he said Thursday.

The company could offer the FTC commitments on top of its existing “Call of Duty” offer to avoid litigation, legal experts say. Still, they add, such a move might not sway the government because it would have to invest in resources to enforce them. Further, they say the FTC might be concerned that concessions deemed sensible today might not be valid in the future.

The agency faces hurdles in its case, legal experts say, because the deal is for a “vertical merger,” meaning that Microsoft wants to buy a company in its supply chain as opposed to a direct competitor. Legal experts say the FTC could argue that the transaction would indirectly put consumers at risk, such as by enabling the misuse of sensitive competitor information by the combined enterprise. With such information, the new entity could prevent upstarts in videogame distribution from succeeding, they say, leaving consumers with fewer choices.

The FTC sued even though Microsoft, through Mr. Smith, has been building relationships in the capital for decades. He had helped cultivate an image of the software giant as one of the friendly technology leaders after serving as the company’s legal adviser through bitter antitrust disputes with regulators worldwide in the 1990s.