u.today
Tesla, the leading e-car manufacturer, has reported a $600 million profit stemming from its Bitcoin holdings in the fourth quarter of the year.
This was possible due to the adoption of a new accounting guideline introduced by the Financial Accounting Standards Board (FASB) that makes it possible to report holdings at their current market value.
The leading e-car manufacturer initially purchased Bitcoin back in 2021. However, it has sold a significant portion (roughly 75%) of its holdings since then.
The company's total Bitcoin holdings now stand at nearly $1.1 billion after the company adopted the new accounting standard. It did not sell any coins in the fourth quarter.
Tesla's Bitcoin holdings would have been worth roughly $2.4 billion as of now had it refrained from liquidating a large chunk of them in the past.
The shares of Tesla (TSLA) are up more than 4% in pre-market trading after dipping by more than 2% on Wednesday.
The Bitcoin profits helped to brighten up the overall picture for Telsa, which would have failed short of meeting the consensus earnings per share (EPS) estimate.
"Strip out the $0.15 per share gain from Tesla's Bitcoin sale, and Q4 EPS was $0.58, which is a 25% miss vs consensus estimates of $0.77," Tesla bear Motorhead (@BradMunchen).
Investors were apparently encouraged by robotaxi promises as well as well expectations of a sales recovery in 2025.