Musk’s Old Pay Deal, Not His New One, Could Deliver The Biggest Blow To Tesla’s Profits

Benzinga

Tesla faces a potential $26 billion profit hit over two years if the Delaware Supreme Court upholds the voiding of Elon Musk’s 2018 pay package, a larger threat than his new trillion-dollar compensation plan. Even if Tesla wins, Musk’s massive payout structure could pressure profits for years, raising concerns about governance and shareholder dilution. Analysts warn the plan could trigger tens of billions in payouts given today’s stock price.

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00:00It's Benzinga, bringing Wall Street to Main Street.

00:02Tesla CEO Elon Musk's unresolved 2018 pay package poses a larger threat to Tesla's future profits

00:07than his new trillion-dollar compensation plan, according to Reuters.

00:11The pending Delaware Supreme Court ruling could leave Tesla facing a $26 billion profit in over

00:16two years if its appeal of Musk's voided 2018 pay package fails. The charge reflects the higher

00:21value of Musk's replacement package at today's stock price. Even if Tesla wins the case,

00:26Musk's enormous pay plan could still strain profits for years, underscoring the unusual

00:30risks of a compensation package worth more than the typical CEO package. Cornell's University's

00:35Brian Dunn, born resulting hit to net income, shows Tesla's board is enabling a large transfer of

00:41wealth from shareholders to Musk. Tesla says Musk's new pay plan depends on ambitious profit milestones,

00:47but even its easiest goals could still trigger tens of billions in payouts with a maximum value of

00:51$878 billion. For all things money, visit Benzinga.com.

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