5BTC or 111% + 111 Free Spins!
New players only. Exclusive 111% Welcome Bonus + 111 Free Spins
Electric vehicle maker Tesla has recently sold part of its Bitcoin holdings. This according to its latest quarterly earnings report. Reportedly, Tesla made a $272 million profit from the sale of its digital assets. Only a small 10% share of its total Bitcoin holdings was sold.
In a 30-pager accompanying its quarterly financial results, Tesla pointed to a $101 million “positive impact” as a result of its Bitcoin sale:
“Year over year, positive impacts from volume growth, regulatory credit revenue growth, gross margin improvement driven by further product cost reductions and sale of Bitcoin ($101M positive impact, net of related impairments, in Restructuring & Other line), were mainly offset by a lower ASP, increased SBC, additional supply chain costs, R&D investments and other items. Model S and Model X changeover costs negatively impacted both gross profit as well as R&D expenses.”
While many mainstream investors are not surprised by the company’s move to sell its bitcoin at a profit, the 10% that was sold is by no means a loss of faith in the top cryptocurrency. In March Tesla has started accepting Bitcoin as payment for its cars without converting it into fiat currency.
Considering that 90% of its initial $1.5 billion purchase still remaining on its balance sheet, CEO Elon Musk responded on Twitter with a clarification.
According to the ‘Technoking of Tesla’, the sale was done to prove the asset’s liquidity and viability as an alternative to cash on its balance sheet.
Nonetheless, there is skepticism about the move as it shows how easily a company that has Bitcoin on its balance can “tweek” its company’s performance by selling the cryptocurrency.
While noting that it is expecting vehicle delivery growth to exceed 50% this year, the company announced good Q1 numbers. It reports net income of $438 million in the first quarter, a new all-time high. On a revenue of $10.39 billion, per-share earnings were 93 cents.