Tesla has revoked the $29 billion “interim” compensation package it gave CEO Elon Musk last year after the Delaware Supreme Court recently reinstated the largest compensation of $56 billion from 2018.
The company had given Musk the interim package in August 2025 to offset the possibility that the Delaware Supreme Court would reject his appeal. Tesla had explained to investors that the interim package would be canceled if Musk prevailed. “[T]There can be no ‘double dipping’ here,” the company wrote last year.
Sure, Tesla confirmed quarterly deposit with the Securities and Exchange Commission on Thursday morning that it strengthened the April 21 interim award. Tesla said the board voted without Musk or his brother (and fellow director) Kimbal Musk.
“These actions are consistent with the no-double-dipping principle, which precludes Mr. Musk from earning a windfall should he exercise his 2018 CEO Performance Award,” Tesla wrote in the filing.
Tesla awarded the $56 billion package to Musk in 2018 and was challenged in court by a shareholder who accused the CEO of essentially negotiating against him on his design and not properly informing shareholders about it. That case took years to play out in Delaware’s Chancery Court before a judge finally ruled in 2024 that the plaintiff was right and threw out the pay package.
Tesla waged a public affairs campaign while appealing the judge’s decision to the state’s highest court. This included a “re-vote” on the package to ostensibly prove that shareholders had not been duped. Musk, meanwhile, has threatened to leave Tesla altogether to develop artificial intelligence elsewhere. That prompted Tesla’s board to set the $29 billion award as compensation and also work on a much larger and much more ambitious compensation package worth up to $1 trillion.
Revoking this interim award has no effect on Musk’s $1 trillion package. To access that full sum, Musk must lead Tesla to a series of operational milestones (such as delivering 20 million vehicles and a million robots and a million robotaxis on the road) and grow its valuation to more than $8 trillion over 10 years.
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Interestingly, Tesla explained in the quarterly filing that it is beginning to make its own estimates about the milestones Musk could and could not achieve. The company did not specify what it believed Musk would achieve, but wrote that it has “unrecognized stock-based compensation cost of $9.97 billion for the operational milestone deemed likely to be achieved during the award.”
The company went on to say it has unrecognized stock-based compensation costs of between $105.82 billion and $120.37 billion for “operating milestones deemed not likely to be achieved,” though it did not specify which milestones it meant.
While Musk has 10 years to hit all the goals tied to the trillion-dollar package, many of those operational milestones are watered-down versions of promises he’s made in the past. However, it seems that Tesla himself is not sure that he will be able to execute at least some.
Tesla also explained in the filing that its board decided to place some barriers on how and when Musk can sell shares from the now-restored 2018 package “to mitigate any negative impact of significant stock sales on the Company.”
These restrictions appear to track some of the more general ones set out in the $1 trillion pay package. They require Musk to remain a CEO or product development executive at the company until at least 2028 for the shares to vest, and require him to hold the shares for five years.
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