Elon Musk Might Sell More Tesla Stock in 2024.

Elon Musk Might Sell More Tesla Stock in 2024.

Elon Musk and Hyperloop

It’s the end-of-the-year holiday season, which means egg nog and presents. This time has also come to mean something for Tesla 3.93% investors: wondering about Elon Musk’s potential sales of Tesla stock.

To be clear, there is no reason to expect sales this year, but if things don’t stabilize at X, Musk might have to break a promise he made about his Tesla sales in 2022.

This isn’t a merry topic for investors. Stock sales by key executives always make shareholders nervous. What’s more, Musk owns a lot of Tesla stock. He has sold a lot from time to time, too.

Musk sold billions of dollars in stock in late 2021, mainly to pay taxes while exercising expiring stock options, while debating the taxation of billionaires with Sen. Elizabeth Warren (D., Mass.).

Musk sold billions of dollars of Tesla stock throughout 2022 to help fund the purchase of his social-media platform, once called Twitter and now named X. His last 2022 stock sale happened in November.

Large transactions move stock prices. In 2022, from April 14, when Musk tweeted “I made an offer” for Twitter, until late December, when he said he was done selling stock, Tesla shares fell more than 60%.

 lost more than 20% over the same span—but Tesla stock’s performance was significantly worse. Investors don’t like adding to positions if they know large stock sales are coming. Musk said he wouldn’t sell any more Tesla stock for at least 18 months in December 2022. In the three months following that pronouncement, Tesla stock rallied more than 50%.

Musk’s December declaration also put the earliest potential sales of Tesla stock in June 2024. There isn’t any formal assurance that sales won’t happen before then. It depends, to some extent, on how X is performing.

X and Tesla didn’t immediately respond to requests for comments about potential stock sales by Musk, or X financials.

How X is doing has become a key question for Tesla investors in recent weeks after several advertisers paused spending on the platform following a Nov. 16 report from progressive media watchdog Media Matters that showed advertiser content adjacent to anti-Semitic material. The report followed a controversial tweet from Musk about the conflict in Palestine.

is suing Media Matters, alleging the watchdog skewed data, making the issue seem worse than it is. Media Matters called the X suit “frivolous.” Musk has strenuously denied he is anti-Semitic, and said this past week that a lack of advertising on X could kill the company.

When Musk bought the company, Twitter was generating about $1.2 billion in revenue each quarter. It was producing bottom-line profits, but wasn’t generating free cash flow, using about $100 million per quarter.

Musk laid off about 80% of Twitter staff in 2022 after pointing out the company was losing $4 million a day. Results were close to break-even in April 2023, according to Musk. To make that math work with layoffs, revenue was likely down in the range of 30% to 40% year over year.

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