Even though it wasn’t a close vote, the decision to accept Elon Musk’s huge 2018 pay package did get more shareholders involved.
Shareholders decided on Thursday to reinstate Musk’s 2018 pay package, which included 300 million stock options with lots of incentives. The vote was needed because in January, a Delaware judge threw out the deal because there weren’t enough details given.
Even though new information came out, Elon Musk added X and xAI to his list of businesses, and Tesla’s growth slowed, the second vote wasn’t that close.
Tesla released the final vote counts on Friday. About 1.35 billion shares were voted for return and 529 million shares were voted against it. About 72% of shareholders agreed with the plan, so it was approved.
The motion passed the first time with 73% of the vote. The outcome was pretty much the same, but this time shareholders were more involved, which led to a better conclusion.
When shareholders decided on the pay package for the first time, only about 51% of the shares that were outstanding, or 86.4 million shares, were cast.
This time, votes from almost 60% of shares were cast. Currently, there are about 3.2 billion Tesla shares out there. Since 2018, it has split its stock twice.
Lots of people said no, but more people said yes. In the first vote, about 14% of all outstanding shares voted against Musk’s pay deal. There were almost 17% votes against Musk’s pay deal this time.
When it came to “yeses,” 42% of all shares were “yes” in 2024, up from 37% in 2018.
Voting helped Musk get some of his pay back. Investors can use any method to figure out that the vote wasn’t that close. The plan would have easily passed even if engagement hadn’t changed, 51% of people had voted, and the “no” votes still made up 17% of all shares.
It is clear what the message is for investors. The people who own Tesla want Musk to run the business.
That’s for a good reason. Tesla is having trouble, but in the last six years, shares have gone up about 10 times.
That’s why Musk’s choices are so valuable. Musk did not get paid in cash. With the stock market going from $50 billion to $550 billion, investors gave Musk about 10% of the rise in value.
This past week, Tesla stock only went up about $2 per share. A lot of buyers were hoping for a bigger jump. The small change could mean that most buyers thought the package would pass without much trouble.
Yes, it did.
As of Friday, Tesla stock was down about 28% for the year, about 46 percentage points less than the Nasdaq Composite. Investors are less optimistic because EV growth is slowing down.
