CEO Elon Musk doesn’t receive a salary for his work at Tesla. Instead, his pay package stipulates he gets the opportunity to buy shares of TSLA at a discounted price if the company meets certain targets.
With Tesla’s quarterly revenue of $10.39 billion and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $1.84 billion announced in the Q1 2021 earnings report yesterday, those targets have been met and Musk’s fifth and sixth tranches have now vested, reports Reuters.
With each tranche allowing Musk to purchase shares at $70 each, and given the current share price of TSLA, that means the two tranches are worth around $11 billion.
It is important to remember that this is just income on paper, and Musk doesn’t have any more cash than he did last week. The CEO has said many time he has no intentions of selling his shares, and plans to use the money to help make the human species interplanetary.
This hasn’t stopped critics from calling out the CEO, most notably US politician Bernie Sanders, who likes to use Musk’s net worth to call for higher taxes on the rich.
Space travel is an exciting idea, but right now we need to focus on Earth and create a progressive tax system so that children don't go hungry, people are not homeless and all Americans have healthcare. The level of inequality in America is obscene and a threat to our democracy. https://t.co/CbMWYnPFUx
— Bernie Sanders (@BernieSanders) March 21, 2021