Tesla Stock Surges After Musk Discloses Purchases Worth $1 Billion
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
Tesla (NYSE: TSLA) stock is trading higher today after CEO Elon Musk disclosed that he purchased $1 billion worth of the company’s shares. This acquisition, which occurred on September 12, 2025, marks his first open-market purchase of the company’s shares since February 2020.
Musk’s purchase, made through a trust, involved acquiring around 2.57 million shares at varying prices, as disclosed in a regulatory filing.
The move comes a few days after Tesla’s board unveiled a new pay package for Musk that could be worth a staggering $1 trillion. The proposal, which will be put to a shareholder vote on November 6, could make him the world’s first trillionaire if fully achieved.
The new plan is a direct response to the ongoing legal challenges surrounding Musk’s 2018 compensation package, which a Delaware court has twice revoked. Despite shareholders voting to reinstate that deal in June 2024, the legal battles prompted Tesla’s board to create a new framework to ensure Musk remains “eager” and “focused” on the company’s long-term vision.
Tesla Board Proposed New Compensation for Musk
The compensation would be in the form of stocks and linked to several milestones that must be met over the next 10 years. These include
- Market Capitalization: Tesla’s market value, currently around $1.1 trillion, would need to skyrocket to at least $8.5 trillion for Musk to unlock the full payout.
- Vehicle Production: The company must achieve an annual vehicle delivery rate of 20 million, a nearly tenfold increase from its current levels.
- Robotics and AI: The plan includes targets for the deployment of 1 million “robotaxis” and 1 million of the company’s humanoid “Optimus” robots.
- Profitability: Financial goals are equally aggressive, with adjusted EBITDA needing to increase from approximately $17 billion to $400 billion.
The compensation would be awarded in a series of tranches, with each payout contingent on a combination of market capitalization and operational milestones. To receive any of the shares, Musk would need to remain with the company for at least 7.5 years, with the full package requiring a 10-year commitment.
Musk Acquires Tesla Shares Worth $1 Billion
If approved by shareholders, the plan could increase Musk’s ownership stake in Tesla to over 25%, significantly consolidating his control over the company. Notably, in a post on X in January 2024, Musk said that “I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control. Enough to be influential, but not so much that I can’t be overturned.”
Currently, Musk owns approximately a 13% stake in Tesla, and his ownership stake decreased after he sold shares to fund his acquisition of Twitter. His buying Tesla stock is seen as a sign of his commitment to the company.
Commenting on Musk’s stock purchase, Dan Ives, tech analyst with Wedbush Securities, said, “It’s a huge vote of confidence from Musk and the bulls love seeing this.” He added, “It sends a positive signal after a very tumultuous year for Musk and Tesla shareholders.”
Notably, Musk’s buying Tesla shares acts as a powerful statement that Musk believes in the company’s future and finds its stock is currently undervalued. For years, Musk has been a vocal proponent of a singular, audacious vision for Tesla: that it will one day be the biggest company in the world. This is not a new claim; it’s a recurring theme that has evolved alongside the company itself, shifting from a focus on electric vehicles to a broader platform centered on artificial intelligence and robotics.
While previously Musk said that Tesla would be more than the combined worth of Apple and Saudi Aramco, he has since been making even bolder predictions, and last year said that the company’s Optimus humanoid would make it a $25 trillion company. However, many Wall Street analysts don’t share Musk’s optimism and see the stock as highly overvalued.
TSLA’s Sales Have Sagged
Meanwhile, Tesla’s automotive business is facing a severe slowdown with sales falling in 2024 and again in the first half of 2025. While CEO Elon Musk has been trying to steer Tesla from an EV company to a tech giant focusing on artificial intelligence, robotics, and humanoids, the company’s core automotive business has been facing several challenges.
The Tesla CEO has warned of a few “rough quarters” ahead as the One Big Beautiful Bill Act does away with the EV tax credit, which could hurt sales. While the company’s US sales might get a boost in Q3 as buyers rush to claim the EV tax credit, its global sales could be subdued in the quarter, looking at the data from Europe and China.
Chinese Automakers are Giving a Tough Fight to Tesla
Globally, Tesla is facing a tough fight from Chinese automakers, especially BYD, which has continued its strong growth trajectory, selling more BEVs than Tesla in the first six months of the year. Looking at the strong growth in the first six months of the year, BYD looks set to become the world’s biggest seller of BEVs in 2025 and hit yet another milestone.
Notably, in 2011, Tesla CEO Elon Musk laughed at the possibility of BYD becoming a competitor to Tesla. However, the Chinese company has proven critics wrong and has emerged as a serious competitor to Tesla, not only in China but also in global markets.
Musk, too, has changed his mind about BYD, and in 2023, he praised the company, terming it “highly competitive.”
Musk on Chinese EV Companies
The Tesla CEO has been all praise for Chinese EV companies and, during Tesla’s Q4 2023 earnings call, said, “Frankly, I think, if there are not trade barriers established, they will pretty much demolish most other companies in the world.”
The billionaire added, “The Chinese car companies are the most competitive car companies in the world. So, I think they will have significant success outside of China depending on what kind of tariffs or trade barriers are established.”
All said, markets have been willing to look the other way even though the fundamentals of Tesla’s automotive business have deteriorated on hopes that AI products like Optimus would drive the company’s next leg of growth. Musk buying Tesla stock is a clever ploy to signal his faith in the new trajectory that he is trying to steer the company to.
