Tesla CEO Elon Musk nears $7 billion payday

If Tesla announces in tomorrow’s earnings call what everyone is expecting them to, CEO Elon Musk could be starting 2021 with another massive payday.

Unlike most CEO’s Musk doesn’t take a salary from Tesla. Instead his pay package entitles him to buy Tesla (TSLA) shares at a big discount if the company meets certain financial targets.

That resulted in Musk earning four separate tranches in 2020, allowing him to buy nearly 34 million TSLA shares at just $70 each.

Musk could earn another 8.4 million shares tomorrow. During tomorrow’s earning call, Tesla is expected to report adjusted earnings before interest, taxes, depreciation, and amortization of $2.3 billion, up 92% from the year previous.

If they do, Musk would earn his fifth tranche and the first of 2021. At current trading prices, that would net Musk nearly $7 billion (via Reuters).

It is worth noting it is only a payday on paper. Musk has said several times he has no plans to sell his shares, and will use his immense wealth to help make humans an interplanetary species.

Here’s what else to expect at tomorrow’s Q4 2020 earnings call.