Back in December 2022, Tesla (NASDAQ:TSLA) CEO and billionaire Elon Musk announced via X, the platform formerly known as Twitter, that he would avoid selling TSLA stock for the next 18 to 24 months. Based on this statement, the earliest the CEO could sell shares would be June 2024. Musk’s last sale occurred in November 2022 as well, when he offloaded about $4 billion worth of shares, likely to fund his acquisition of X. Since then, TSLA stock is up by about 20%.
According to Barron’s, Musk’s next potential sale of the electric vehicle (EV) company will depend on the performance of X. Based on declining advertising spending, things aren’t exactly going well at the social media platform, especially after Musk was involved in a controversial tweet related to the conflict in Israel and Palestine. That has led many advertisers to pull back their spending.
TSLA Stock: Musk Could Sell Shares Next Year
Musk purchased X for $44 billion, although that price tag has since been slashed by more than half. In late October, Bloomberg reported that employees received restricted stock units at $45 per share, which would value the company at $19 billion, according to sources close to the matter.
Meanwhile, Musk has laid off 80% of X’s staff since the acquisition, citing the fact that Twitter was losing $4 million everyday.
“Results were close to break-even in April 2023, according to Musk. To make that math work with layoffs, revenue was likely down in the range of 30% to 40% year over year,” estimates Barron’s. The publication has also provided a rough guess that Twitter could be losing between $100 million and $200 million each quarter.
Ultimately, X’s performance and hopes for an advertising recovery are likely correlated with potential sales of TSLA stock by Musk.
On top of that, an Internal Revenue Service (IRS) filing shows that Musk is seeking to start a primary and secondary school in Austin, Texas. Musk has already provided a seed investment of $100 million. Furthermore, Musk plans on expanding the initiative to include a university once the primary and secondary schools are completed. Its unclear how he will fund the expansion, although this could point to a potential sale in TSLA stock.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
