Tesla Reports $125 Million Losses on Bitcoin Investments Amid Market Declines

Tesla reported $125 million in unrealized losses on Bitcoin due to a 12% decline in cryptocurrency value during Q1. The company’s digital assets are valued at $951 million and its Bitcoin holdings remained unchanged at 11,509 BTC. Despite losses, Tesla’s stock surged during after-hours trading.

Tesla Inc., led by Elon Musk, reported a mark-to-market loss of $125 million on its cryptocurrency investments in the first quarter. Despite these losses, the company maintains a substantial balance of digital assets, valued at $951 million, which represents an 11.6% decline from the previous quarter. Tesla’s Bitcoin holdings, which remain unchanged at 11,509 BTC, correlate with the cryptocurrency’s recent dip of approximately 12% during the quarter.

Although Tesla’s Bitcoin valuation decreased, the cryptocurrency has since regained some ground, rising 13% in April. This recovery may positively influence the company’s unrealized losses. The introduction of new accounting standards allows firms to report cryptocurrency assets at market value, potentially impacting Tesla’s financial reporting and net income.

Tesla initiated its cryptocurrency investment journey in January 2021 with an acquisition of $1.5 billion in Bitcoin. In conjunction with the losses on its Bitcoin investments, the company reported declining revenue and earnings for the first quarter, both falling short of analysts’ expectations. Bitcoin was trading up 5.62% at $93,315.25 at the time of reporting.

In after-hours trading, Tesla’s shares rebounded by 5.39% after closing up 4.60% at $237.97 during the day. The company’s stock also achieved a high quality score reflecting its operational efficiency and financial health. Investors may want to compare Tesla’s performance against other major corporate holders of Bitcoin, such as MicroStrategy, noted in Benzinga Edge Stock Rankings.