Tesla Reports USD 101 Million Profit on Bitcoin | #site_titleTesla Reports USD 101 Million Profit on Bitcoin

Tesla Reports USD 101 Million Profit on Bitcoin

After the market closed on Monday, Tesla Inc. (NASDAQ; TSLA) had a strong earnings call and reported a record income of USD 438 Million, up 74% year-over-year. While Tesla also reported record delivery numbers for the quarter, the Company has struggled to keep its vehicle inventory up with high demand. A global semiconductor-chip shortage has caused production delays that have led to longer than expected delivery times for Tesla customers. Despite the setback however, the Company reported that it sold about 10% of its holdings in Bitcoin, worth roughly USD 272 Million, that helped boost profit by USD 101 Million.

Elon Musk has become a celebrity in the world of cryptocurrency, and he of course made headlines after Tesla had bought USD 1.5 Billion worth of Bitcoin with plans to begin accepting it as payment. The Company’s massive return on Bitcoin had reportedly contributed to nearly 25% of its net profit. This means that ironically enough Tesla turned in more of a profit off of trading Bitcoin than selling vehicles. Some investors are concerned that Tesla is engaging in a massive pump-and-dump scheme with Bitcoin to turn in a profit in the short term. “So am I understanding this correctly? @elonmusk buys #bitcoin. Then he pumps it. It goes up. Then he dumps it and make a fortune”, said Barstool Sports founder Dave Portnoy in a tweet.

Elon Musk responded and clarified that he has not altered his own personal investment in Bitcoin, and that Tesla sold 10% of its Bitcoin to “prove liquidity of Bitcoin as an alternative to holding cash on balance sheet.” During a conference call with analysts, Tesla’s CFO Zachary Kirkhorn stated, “Bitcoin has proved to be a good decision, a good place to put some of our cash that’s not being used for daily operations…and be able to get some return on that… It is our intent to hold long-term.”

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