Tesla sold Bitcoin for $272 million in the first quarter. Tesla purchased $1.5 billion worth of Bitcoin in February this year, according to disclosure filing with the Securities and Exchange Commission. The company still has over $1.3 billion worth of hold cryptocurrency on its balance sheet.
The sale trimmed Tesla’s position by 10 % Tesla CFO Zach Kirkhorn said on an earnings call Monday.
In the reports ‘Statement of cash flow’ section, the company list “proceeds from sale of digital assets” with $272 million in proceeds for its sale of Bitcoin last quarter.
The report details the sale of some of the company’s Bitcoin holding further,
“Year over year, positive impacts from volume growth, regulatory credit revenue growth, gross margin improvement driven by further product cost reductions and sale of Bitcoin ($ 10M positive impact, net of related impairment, in “Restructuring and other” in 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.”
Kirkhorn said that Tesla invented bitcoin to earn a yield on its excess cash in a low-interest-rate environment.
While the company continues to deal with global supply chain crunches like semiconductor shortage or ship port capacity. Also said the bitcoin market is a liquid market with an optimistic future.
“Quarter-end cash and cash equivalents decreased to $17.1B in Q1, driven mainly by a net cash outflow of $1.2 B in cryptocurrency (bitcoin) purchases, net debt, and finance lease repayment of $1.2B, partially offset by free cash flow of $293M.” – Tesla
Many on Twitter have begun to blast Elon Musk and Tesla over the company decision. One prominent account in the crypto Twitter community known as Bitcoin Archive said, “Tesla made more money trading Bitcoin than trading cars”. The Bitcoin Archive Twitter account also compares Elon musk and Marcus Brutus, the man who betrayed Julius Caesar.
Also Read: Now You Can Pay in Bitcoin To Buy Tesla!
Dave Portnoy, the founder of Barstool Sports, also tweeted about making money by pumping and dumping bitcoin. Elon encountered saying that he didn’t sell any of his bitcoin.
“There aren’t many traditional opportunities to do this, or at least that we found… particularly with yields being so low and without taking on additional risk or sacrificing liquidity,” Kirkhorn said, despite bitcoin perception as a risk asset among most traditional financial analysts.
Telsa will continue to accumulate bitcoin through customer transactions and bitcoin-related announcements in the future, Kirkhorn added.
