Elon Musk, the CEO of Tesla, achieved a major victory on Thursday after shareholders approved a massive compensation package worth $878 billion over the next decade, backing his vision to transform Tesla from an electric car manufacturer into a powerhouse in artificial intelligence and robotics.
Tesla’s stock rose by about 1% in after-hours trading following the announcement that more than 75% of shareholders had voted in favor of the proposal.
Analysts view this outcome as a positive sign for Tesla’s stock, which largely depends on Musk’s plans to expand into self-driving vehicles, robotaxi services across the U.S., and the development of humanoid robots. However, some note that Musk’s controversial political statements have negatively affected Tesla’s brand image this year.
At the shareholder meeting in Austin, Texas, Musk took the stage accompanied by dancing robots and said:
“What we’re about to embark on isn’t just a new chapter in Tesla’s story—it’s an entirely new book. This will be a truly remarkable story.”
Shareholders also re-elected three board members and voted to hold annual elections for all board members. They additionally approved an alternative compensation plan for Musk after a previous one was blocked by a legal challenge. Musk joked:
“Other shareholder meetings are like boring parties, but ours was awesome.”
Shareholders further voted in favor of Tesla investing in Musk’s artificial intelligence startup, xAI, despite some abstentions and concerns over potential conflicts of interest. Experts say the collaboration between the two companies could be mutually beneficial: Tesla relies on advanced AI for its self-driving ambitions, while xAI would gain a major client in Tesla.
Musk’s victory had been widely expected after he regained full voting rights for his roughly 15% stake in the company, following Tesla’s relocation from Delaware to Texas, where a previous legal challenge had blocked an earlier pay increase.
Despite opposition from some major investors, including Norway’s sovereign wealth fund, the proposal passed—especially after Tesla’s board warned that Musk might step down if the pay package was not approved
Conditional Bonus
The newly approved deal is based on stock options tied to specific performance goals, not direct cash payments. Musk will only receive the reward if he manages to:
If these targets are achieved, Musk would receive 423.7 million new Tesla shares once the company reaches the set market valuation.
