Tesla Inc. ( TSLA ) stock surged more than 3% in pre-market trade on Thursday despite the company missing fourth-quarter revenue estimates and CEO Elon Musk admitting that the EV giant would have to replace the HW3 computers in existing cars to make them full self-driving (FSD) compatible.

Tesla bear and GLJ Research's Gordon L. Johnson pointed out that Musk admitting HW3 cars cannot fully utilize FSD technology points to a bigger problem, which is, how can Tesla be sure that FSD will work with HW4 or even HW5.

"This is a huge deal, as TSLA promised that all its cars since 2016 had the hardware to utilize FSD; and, many sell-side analysts are currently giving TSLA billions in value for its HW3 cars, under the assumption those cars will generate millions in revenues as FSD robotaxis," Johnson said.

He pointed out that 80% of Tesla's cars on the road use HW3 – and that's a problem.

Why It Matters: Tesla reported revenue, earnings per share, and gross profit margin for the fourth quarter that were below expectations on Wednesday.

Aiding TSLA stock's rise in pre-market is the fact that the company is looking to start production of new models across more affordable price points, giving its portfolio a much-needed boost.

Price Action: Tesla stock gained more than 3% during pre-market hours, after closing 2.3% down on Wednesday. Tesla's shares have more than doubled over the past year, rising 103%, according to Benzinga Pro data.

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