Investor's Corner
Tesla will raise nearly $1.4B after higher than expected investor demand
Expanding Capital Raise to Meet Demand
Tesla has upped it’s capital raise from $1.15B to $1.38B after investors indicated higher demand for the offering. The company initially planned to offer 968,993 common shares and increased that to 1,335,878 shares of stock, raising an additional $350M. In addition to an increase in the common stock offering, Tesla also raised $850M from a convertible debt sale with an additional $127.5M available to the underwriters. The company initially intended to offer $750M in debt and raised that by $100M to meet demand. We will know within 30 days whether the underwriters decide to exercise their options to purchase, which would net Tesla an additional ~$180M. If the underwriters exercise their options, then the total proceeds of the sale will net $1.38B. This capital raise is intended to “de-risk” the company’s financial condition as they focus on getting the Model 3 into production this year.
Tesla’s bond offering of $850M consisted of 2.375% Convertible Senior Notes due March 15, 2022. Compared to previous convertible bond offerings, Tesla increased the interest rate on the bonds while lowering the “conversion” premium. The conversion premium allows for the bond holder to exchange their bond for common stock, Tesla has set the price of that conversion at $327.50, which is roughly 25% above current market value. Previous convertible bond offerings had a conversion premium of 42.5% above their respective market values and interest rates of .25% and 1.25%. (This analysis does not look at the debt offering SolarCity had before the Tesla-SolarCity merger last fall.)
“Secret” Investor Call
On March 16, a user on the Tesla Subreddit revealed that Elon Musk and other company officials were holding a conference call with the investors directly involved in the sale of shares and bonds. Tesla did not announce the call on its Investors Relations page nor provide a transcript of the call.
According to reddit member electricmusk who was affiliated with the raise and attended the call, Elon Musk revealed that there would be no “beta” version of the Model 3. Instead, the company is going straight to an “early release candidate.” In the industry, that normally refers to cars built on the actual assembly line that will be used for normal production.
If true, that suggests the Model 3 production line is now complete and ready to start producing cars. Later in the conference call, Musk is heard saying “we will be driving it (the early release candidate) within a week or two.” Musk reportedly said that advanced analytical techniques are allowing the company to skip the usual beta phase. He promised the Model 3 will have higher initial quality than either the Model S or Model X because of those analytical tools.
The quick transition to early release candidate cars has some people on Reddit concerned. john_atx, a first day Model 3 reservation holder, explained it this way.
“No, it does mean something. Start of production is July, and they don’t have any cars to test now in the middle of March. So let’s say they can start driving their cars by April. If an issue comes up, they have weeks to get it resolved. Normally you have a fleet of production intent cars driving in all conditions to get data. Tesla won’t have enough time to find the problems and implement corrective actions before Start of Production.”
Those who were able to listen in on the conference call report one other interesting tidbit. At one point, Elon Musk is heard to say — albeit indistinctly — that Tesla will transition to the 2170 battery cells for the battery packs in its Model S and Model X cars “by the end of the year,” according to reddit user electricmusk. Tesla’s 2170 lithium ion cells are currently being manufactured at Gigafactory 1 and being used in its commercial and home energy storage systems. The cells will also be used in the upcoming mass market Model 3 sedan.
Come join the discussion on Model 3 as Tesla prepares to put the vehicle into mass production.
Elon Musk
Tesla stock gets latest synopsis from Jim Cramer: ‘It’s actually a robotics company’
“Turns out it’s actually a robotics and Cybercab company, and I want to buy, buy, buy. Yes, Tesla’s the paper that turned into scissors in one session,” Cramer said.
Tesla stock (NASDAQ: TSLA) got its latest synopsis from Wall Street analyst Jim Cramer, who finally realized something that many fans of the company have known all along: it’s not a car company. Instead, it’s a robotics company.
In a recent note that was released after Tesla reported Earnings in late January, Cramer seemed to recognize that the underwhelming financials and overall performance of the automotive division were not representative of the current state of affairs.
Instead, we’re seeing a company transition itself away from its early identity, essentially evolving like a caterpillar into a butterfly.
The narrative of the Earnings Call was simple: We’re not a car company, at least not from a birds-eye view. We’re an AI and Robotics company, and we are transitioning to this quicker than most people realize.
Tesla stock gets another analysis from Jim Cramer, and investors will like it
Tesla’s Q4 Earnings Call featured plenty of analysis from CEO Elon Musk and others, and some of the more minor details of the call were even indicative of a company that is moving toward AI instead of its cars. For example, the Model S and Model X will be no more after Q2, as Musk said that they serve relatively no purpose for the future.
Instead, Tesla is shifting its focus to the vehicles catered for autonomy and its Robotaxi and self-driving efforts.
Cramer recognizes this:
“…we got results from Tesla, which actually beat numbers, but nobody cares about the numbers here, as electric vehicles are the past. And according to CEO Elon Musk, the future of this company comes down to Cybercabs and humanoid robots. Stock fell more than 3% the next day. That may be because their capital expenditures budget was higher than expected, or maybe people wanted more details from the new businesses. At this point, I think Musk acolytes might be more excited about SpaceX, which is planning to come public later this year.”
He continued, highlighting the company’s true transition away from vehicles to its Cybercab, Optimus, and AI ambitions:
“I know it’s hard to believe how quickly this market can change its attitude. Last night, I heard a disastrous car company speak. Turns out it’s actually a robotics and Cybercab company, and I want to buy, buy, buy. Yes, Tesla’s the paper that turned into scissors in one session. I didn’t like it as a car company. Boy, I love it as a Cybercab and humanoid robot juggernaut. Call me a buyer and give me five robots while I’m at it.”
Cramer’s narrative seems to fit that of the most bullish Tesla investors. Anyone who is labeled a “permabull” has been echoing a similar sentiment over the past several years: Tesla is not a car company any longer.
Instead, the true focus is on the future and the potential that AI and Robotics bring to the company. It is truly difficult to put Tesla shares in the same group as companies like Ford, General Motors, and others.
Tesla shares are down less than half a percent at the time of publishing, trading at $423.69.
There are a lot of Tesla bulls out there who have astronomical expectations for the company, especially as its arm of reach has gone well past automotive and energy and entered artificial intelligence and robotics.
However, some of the most bullish Tesla investors believe the company could become worth $100 trillion, and CEO Elon Musk does not believe that number is completely out of the question, even if it sounds almost ridiculous.
To put that number into perspective, the top ten most valuable companies in the world — NVIDIA, Apple, Alphabet, Microsoft, Amazon, TSMC, Meta, Saudi Aramco, Broadcom, and Tesla — are worth roughly $26 trillion.
Will Tesla join the fold? Predicting a triple merger with SpaceX and xAI
Cathie Wood of ARK Invest believes the number is reasonable considering Tesla’s long-reaching industry ambitions:
“…in the world of AI, what do you have to have to win? You have to have proprietary data, and think about all the proprietary data he has, different kinds of proprietary data. Tesla, the language of the road; Neuralink, multiomics data; nobody else has that data. X, nobody else has that data either. I could see $100 trillion. I think it’s going to happen because of convergence. I think Tesla is the leading candidate [for $100 trillion] for the reason I just said.”
Musk said late last year that all of his companies seem to be “heading toward convergence,” and it’s started to come to fruition. Tesla invested in xAI, as revealed in its Q4 Earnings Shareholder Deck, and SpaceX recently acquired xAI, marking the first step in the potential for a massive umbrella of companies under Musk’s watch.
SpaceX officially acquires xAI, merging rockets with AI expertise
Now that it is happening, it seems Musk is even more enthusiastic about a massive valuation that would swell to nearly four-times the value of the top ten most valuable companies in the world currently, as he said on X, the idea of a $100 trillion valuation is “not impossible.”
It’s not impossible
— Elon Musk (@elonmusk) February 6, 2026
Tesla is not just a car company. With its many projects, including the launch of Robotaxi, the progress of the Optimus robot, and its AI ambitions, it has the potential to continue gaining value at an accelerating rate.
Musk’s comments show his confidence in Tesla’s numerous projects, especially as some begin to mature and some head toward their initial stages.
Elon Musk
Tesla director pay lawsuit sees lawyer fees slashed by $100 million
The ruling leaves the case’s underlying settlement intact while significantly reducing what the plaintiffs’ attorneys will receive.
The Delaware Supreme Court has cut more than $100 million from a legal fee award tied to a shareholder lawsuit challenging compensation paid to Tesla directors between 2017 and 2020.
The ruling leaves the case’s underlying settlement intact while significantly reducing what the plaintiffs’ attorneys will receive.
Delaware Supreme Court trims legal fees
As noted in a Bloomberg Law report, the case targeted pay granted to Tesla directors, including CEO Elon Musk, Oracle founder Larry Ellison, Kimbal Musk, and Rupert Murdoch. The Delaware Chancery Court had awarded $176 million to the plaintiffs. Tesla’s board must also return stock options and forego years worth of pay.
As per Chief Justice Collins J. Seitz Jr. in an opinion for the Delaware Supreme Court’s full five-member panel, however, the decision of the Delaware Chancery Court to award $176 million to a pension fund’s law firm “erred by including in its financial benefit analysis the intrinsic value” of options being returned by Tesla’s board.
The justices then reduced the fee award from $176 million to $70.9 million. “As we measure it, $71 million reflects a reasonable fee for counsel’s efforts and does not result in a windfall,” Chief Justice Seitz wrote.
Other settlement terms still intact
The Supreme Court upheld the settlement itself, which requires Tesla’s board to return stock and options valued at up to $735 million and to forgo three years of additional compensation worth about $184 million.
Tesla argued during oral arguments that a fee award closer to $70 million would be appropriate. Interestingly enough, back in October, Justice Karen L. Valihura noted that the $176 award was $60 million more than the Delaware judiciary’s budget from the previous year. This was quite interesting as the case was “settled midstream.”
The lawsuit was brought by a pension fund on behalf of Tesla shareholders and focused exclusively on director pay during the 2017–2020 period. The case is separate from other high-profile compensation disputes involving Elon Musk.
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