Tesla shares tumbled in after-hours trading after the electric car maker fell below expectations, despite posting its first annual profit, after extensive compensation was paid to its CEO, Elon Musk. .
Operating income rose to $ 575 million (£ 420 million) in the fourth quarter, but was delayed by a $ 267 million payment to Mask. Under a scheme approved by investors in 2018, Musk could eventually qualify for prizes of up to $ 55.8 billion as the share price increased.
Tesla is expanding rapidly as it tries to match its manufacturing capabilities with a stock market valuation that has increased eightfold during 2020 to make it the most valuable car company in the world. The increase in value has made Musk the richest person in the world, with a net worth of $ 206 billion, according to the Bloomberg Billionaires Index.
During 2020, Tesla made annual profits for the first time, with net income of $ 721 million. Still, it made more than $ 1.5 billion selling regulatory credits to other automakers during the year, a source of profit that will disappear as competitors catch up to produce electric cars.
The median sales price of new Teslas declined 11% during the fourth quarter of 2020, as it shifted to cheaper Model 3 and Y models.
The disparity between the company’s earnings and its valuation, at $ 819 billion when markets closed on Wednesday, means investors are eagerly awaiting signs of the company’s future growth. Tesla said it expects to increase production by more than 50% through 2021, but did not provide further details.
Last year, Tesla narrowly missed its goal of delivering 500,000 cars, but is racing to close new plants in Texas and Berlin. Tesla said it is still on track to build its first vehicles at both plants through 2021, as well as further expand its Shanghai plant.
One of the great advantages that Tesla had gained during the massive rise in share prices was easy access to capital, eliminating the main concerns of previous years. Tesla had $ 19.4 billion in cash or its equivalent at the end of December, a stack that will allow it to continue to make significant investments in technologies it considers key to future earnings, such as its autonomous driving capabilities that are still in development.