Tesla Inc. investors voted for Chief Executive Officer Elon Musk’s compensation package and moving the company’s state of incorporation to Texas, signaling confidence in his leadership despite slumping sales and a precipitous drop in the stock price.
The electric-car maker announced the results at its annual meeting Thursday in Austin without disclosing the breakdown of votes. Musk had foreshadowed the outcome the night before in a post on X, saying both resolutions were “passing by wide margins.”
The pay vote is only advisory and doesn’t guarantee Musk will get his money. A Delaware judge nullified Musk’s 2018 compensation plan in January, and Tesla is expected to appeal. If that appeal fails, moving the company’s legal home to Texas would allow the board to revive the pay package in a new state with potentially more favorable courts.
The 2018 package, which passed with 73% of the vote, made Musk eligible for as much as $55.8 billion in stock options if Tesla hit certain milestones. The current value of the options was closer to $48.4 billion at the close of trading Thursday, according to the Bloomberg Billionaires Index.
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Musk’s pay vote was widely seen as a referendum on the CEO’s leadership and frustration with Tesla’s corporate governance. Musk oversees six companies and is prone to distractions and abrupt strategy shifts. Earlier this year, he ordered up Tesla’s biggest layoffs ever only to rehire some of the workers weeks later.
Shareholders also voted to reelect James Murdoch and Kimbal Musk to Tesla’s eight-member board. Murdoch, son of media mogul Rupert Murdoch, has been a member of Tesla’s board since 2017. Kimbal Musk, younger brother to Elon, has been on the board since 2004.
Tesla shares rose 0.3% in extended trading at 5:58 p.m. in New York. Through Thursday’s close, the stock had fallen about 27% this year, compared with a 14% gain in the S&P 500 Index.
At the company’s Austin headquarters, Tesla shareholders cheered as Musk, wearing a black Cybertruck T-shirt, walked on stage. He leapt into the air as investors chanted his name and said, “Hot damn, I love you guys”
In a presentation, Musk hinted that the company was working on three new models, as he has in years past. He also noted that the Supercharger network was growing and that the company was speeding the production of Semi trucks. He said Tesla’s weekly output of Cybertrucks hit a record of 1,300 a week.
“A lot of people said Cybertruck was fake, never going to come out. Now we’re shipping a lot of Cybertrucks,” Musk said.
When asked what Musk was going to do with his billions, he explained that the pay package was structured as options and that he’d have to own Tesla stock for five years. “I can’t cut and run, nor would I want to,” he said.
