Cathie Wood’s trading screen is likely to have shocked investors recently, particularly Tesla (TSLA) bulls.
The Ark Invest boss has made a career out of betting early on market disruption, selling over $30 million in Tesla shares while revenue from Shanghai rolled over.
For years, Wood considered Tesla a virtually untouchable stock, perhaps the crown jewel of her innovation empire. However, with a drop in deliveries in China and a rough year for EV demand, she’s making room for what’s next.
The maverick investor is betting big on Circle’s (CRCL) fintech surge, along with Alibaba’s (BABA) relentless AI push.
For longtime followers, it shows that if an advocate like Wood is easing off on Tesla, maybe the stock’s endless climb isn’t guaranteed.
Cathie Wood buys Circle and Alibaba, sells Tesla shares as demand sputters in China.
Tesla’s China chill forces a reality check for ARK
Cathie Wood typically doesn’t flinch when Tesla wobbles, but this time things look different.
Dumping 70,474 shares worth nearly $30 million across two ARK funds shows she’s seeing something that investors can no longer ignore.
Tesla’s once-reliable growth engine in China is sputtering, and even Tesla’s biggest backers are quietly looking to ease off the accelerator.
Tesla sales slide in Shanghai signals broader demand shift
Tesla’s China woes deepened in October, with the numbers getting ugly.
According to the China Passenger Car Association, Tesla’s retail sales tanked to just 26,006 vehicles, down roughly 36% year over year, marking what has been its weakest month in three years.
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The Shanghai factory managed just 61,497 in total shipments, down 10%, with over 50%, about 35,000, headed overseas.
That clearly shows that domestic demand is fading quickly and Tesla’s now leaning a lot harder on exports to keep its factories humming.
Fund manager buys and sells
- Cathie Wood sells $21.4 million of surging AI stocks
- Veteran fund manager sees quiet fuel for next AI rally
- Top analyst calls ‘kick in the pants’ for S&P 500
Market share tells the same tale.
Tesla’s slice of China’s EV pie dropped to just 3.2% in October from a healthy 8.7% a month earlier, despite the earlier excitement over the refreshed Model Y.
Moreover, with the first 10 months of 2025 showing an 8.4% drop in retail sales to 458,710 vehicles, Tesla is on track for its first full-year dip in the world’s largest EV market.
Cathie Wood’s favorite AI bet hits a rough patch
For all the trimming and rebalancing, Wood’s connection to Tesla is arguably a lot deeper than a quarterly earnings print or regional sales.
Her conviction has always been linked to Elon Musk’s broader ambitions around AI and a belief that the EV pioneer’s true value lies not in its cars, but in code, robots, and autonomy.
- Bold Targets: ARK’s 2023 model set a price target for Tesla stock at $2,000 for 2027, spearheaded by Robotaxi profits. A year later, that jumped to $2,600 for 2029, with the bear and bull cases stretching from $2,000 to $3,100.
- AI, Not Autos: Wood calls Tesla “the biggest AI play out there,” betting that autonomy and software will potentially generate the lion’s share of its future enterprise value.
- Unshaken Exposure: Even after recent trims, Tesla is still making up nearly 12% to 13% of ARKK, about a whopping $1 billion at times.
- The Musk Factor: Wood sees Musk’s empire as the unique convergence of long-tail technologies such as AI, robotics, and energy, and she’s acknowledged that if she were to own just one AI stock, it would be Tesla.
Circle and Alibaba step into the spotlight
After trimming Tesla, Wood loaded up on a couple of stocks that have run red-hot this year. Ark Invest dropped a hefty $30.5 million bet on Circle, scooping up 245,830 shares through ARKK and 70,613 via ARKW.
Moreover, on Nov. 11 and 12, Ark also scooped up nearly $26 million worth of Alibaba stock across ARKK, ARKF, and ARKW, wrapping up a two-day show of confidence in fintech and Chinese AI.
- Circle’s Big Beat, Cold Reception: Circle just posted a superb Q3, where sales and reserve income skyrocketed 66% to $740 million, while net income jumped 202% to $214 million, and EPS smashed forecasts at $0.64 compared to $0.22. Despite the blowout results, shares dropped 10% as investors fixated on Circle’s heightened 2025 expense outlook ($495–$510 million) along with a risk of lower interest rates squeezing USDC reserve income.
- Alibaba’s AI and Cloud Reboot: Alibaba’s AI-powered 2025 resurgence in the cloud, along with a cleaner operating story, caught Wood’s eye. Cloud sales are up an impressive 26% year over year to 33.4 billion yuan, while quick-commerce evolved into a trillion-yuan GMV opportunity. Shares are up over 80% this year, led by robust AI monetization headlines, along with a bold 380 billion-yuan AI/cloud capex plan.