Musk Promises Not To Sell More Tesla Stock—But He’s Broken Vow Before

Topline

Tesla CEO Elon Musk said Thursday he does not plan to sell any more shares of Tesla for at least the next two years, after the billionaire and nascent Twitter owner offloaded nearly $3.6 billion worth of stock this week as Tesla’s share price tumbled.

SpaceX owner and Tesla CEO Elon Musk arrives on the red carpet for the Axel Springer Award 2020 on … [+] December 1, 2020 in Berlin. (Photo by Hannibal Hanschke-Pool/Getty Images)

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Key Facts

Musk said during a Twitter Spaces audio call he will stop offloading Tesla stock after selling nearly $40 billion worth of it in the past year.

Tesla’s share price dropped nearly 9% Thursday to close at $125.35, as investors grow increasingly concerned about demand for the company’s electric vehicles and leery of the massive amount of time Musk is devoting to running Twitter.

The drop put Tesla nearly 70% of its all-time high in January, when the stock at its peak traded above $400 and Tesla’s market capitalization swelled to $1.2 trillion—pushing Musk’s net worth, which is mostly made up of Tesla shares, above $300 billion.

Crucial Quote

“I needed to sell some stock to make sure, like, there’s powder dry…to account for a worst case scenario,” Musk said, while predicting a “serious recession” coming next year.

Contra

Musk tweeted in April, “No further TSLA sales planned after today” but he has held multiple rounds of multi-billion dollar stock sales since then.

Key Background

Tesla’s latest stock dip started around the time Musk completed his $44 billion deal to take over Twitter. The billionaire has defended his work at Twitter even as he has turned much of his attention away from other businesses he runs, like Tesla and SpaceX. Musk has argued reshaping Twitter is a large project that requires a more hands-on approach, while executives at Tesla and SpaceX are capable of running the companies without him. Musk has sold Tesla shares in the past to help cover his deal to buy Twitter, telling the platform’s employees last month he did so to “save” the company. Details of Twitter’s financial situation are no longer known since the company is private, but they outwardly appear bleak. Numerous companies have pulled ad spending on Twitter in response to Musk’s erratic behavior and loosening of content moderation policies, while the billionaire privately told Twitter staff last month the company could soon go bankrupt without a significant increase in revenue.

Forbes Valuation

We estimate Musk to be worth $147.9 billion, making him the second-richest person in the world, behind LVMH CEO Bernard Arnault and his family. He was the world’s wealthiest person for much of 2022 as his net worth soared above $200 billion.