Austin-based Tesla CEO Elon Musk sold nearly $4 billion worth of Tesla stock, according to regulatory filings.
Musk, who recently bought Twitter for $44 billion, sold 19.5 million shares of the Austin-based electric car company Nov. 4-8.
Musk sold $7 billion of his Tesla stock in August while working to fund the Twitter buyout, which he’s walking out of at the time. In all, Musk has sold more than $19 billion worth of Tesla stock since April, including those filed Tuesday, which will likely fund his part of the Twitter purchase.
The takeover of Twitter has not been smooth and the social media platform has seen the exodus of some big advertisers including United Airlines, General Motors, REI, General Mills and Audi in recent weeks. Musk acknowledged “a massive drop in revenue” on Twitter, which relies heavily on advertising to make money.
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The Twitter saga has influenced Tesla in recent months. The automaker’s share price has taken a hit and investors have expressed concern that Musk is spreading himself too thin.
Tesla’s shares, which were flat before Wednesday’s opening bell, are down 8% this week and down 46% this year, far outperforming the broader market payback in what has been a terrible year for investors. Tesla’s stock hit a low of $183.32 on Monday morning. If the stock continues to fall, Tesla stock could be back to where it was trading in November 2020.
There were also conerns that Musk could sell more Tesla stock to pay for the deal, though he said in August he was done selling before then. The revelation that these sales continued left some industry analysts riled.
“Our fear in the final days of the deal was that Musk would be forced to sell more Tesla stock to fund the disaster Twitter deal,” wrote Daniel Ives, an industry analyst at Wedbush said multiple times over the past year that he’s ‘done selling Tesla stock,’ he’s losing more credibility with investors and his followers in a boy who cried a wolf moment.”
Tesla, which moved its headquarters to Austin last year, has faced a difficult year with supply chain issues, rising material costs and a shutdown in China amid pandemic restrictions. Tesla delivered 908,573 vehicles in 2022 and manufactured 365,000 vehicles and delivered 343,000 of them in the third quarter. However, the automaker needs a strong end to the year to meet its sales growth targets.
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Tesla’s massive Austin Manufacturing Facility, which had a grand opening in April, is expected to play a key role in the company’s future. The facility, which is the most advanced to date, currently produces Model-Y vehicles and is expected to produce the Cybertruck, Model 3 and semi-vehicles, as well as the vehicle batteries. Musk has said he expects the Austin Facility to be at 10,000 workers by the end of this year.
Tesla aims to make up to half a million vehicles in Austin over the next year, which would put this among the country’s highest vehicle factories. In August, the plant reached a production rate of 1,000 cars per week.
Most of Musk’s wealth is tied up in Tesla stock. On Tuesday, his personal wealth fell below $200 billion, according to Forbes, but he’s still the richest person in the world. Musk had brought together banks like Morgan Stanley to finance the Twitter deal. His original stake in the deal was around $15.5 billion, Ives estimated. But if stock investors backed out, Musk would be on the hook to replace them or throw in more of his own money.
“The Twitter Circus show has been an absolute debacle from every angle since Musk bought the platform for the whole world: from the 50% layoffs and then some workers back to the review role to users many pushing back to the constant tweeting in this political firestorm setting and now…..sell more TSLA shares,” Ives wrote. “When does it end?”
While Twitter’s future remains much unclear while Musk takes over, there has been speculation that Twitter’s headquarters could be moved to Austin as Musk increasingly moves his ecosystem of businesses to the region. Ives and other industry analysts have predicted that Twitter could open an office or even a second headquarters in central Texas.
Musk has already brought or expanded his other companies to the region, including Tesla and the Bowing Company, both of which are headquartered in central Texas, and SpaceX and Neuralink, which have offices in the region. He also moved his private foundation to Austin.
Musk confirmed in 2020 that he’s relocated to Texas and is spending much of his time in Austin.
This report contains material from the Associated Press.