Part of

Investing in Tesla Stock (TSLA)

What you need to know when investing in Tesla Inc.

Tesla Inc. (TSLA), the world's largest automaker by market value, designs, builds, and markets fully electric vehicles (EV) and energy generation and storage systems. The company also provides services through vehicle service centers, body shops, and charging stations. Tesla makes and sells mid-size sedans, full-size sedans, and compact and mid-size sports utility vehicles.

Tesla was founded in 2003 as Tesla Motors by Martin Eberhard and Marc Tarpenning. Elon Musk invested in the company and became its chair the next year. An out-of-court settlement of Eberhard's lawsuit against Musk after Eberhard's ouster as CEO allowed both men to call themselves co-founders, along with Tarpenning and early hires Ian Wright and J.B. Straubel. The company was founded as a maker of electric vehicles and related components and has subsequently expanded into energy generation and energy storage products. Tesla went public in an initial public offering (IPO) on June 29, 2010.

In 2021, Tesla moved its headquarters to Austin, Texas, from its longtime home in Palo Alto, Calif. Musk is Tesla's chief executive officer. Tesla's stock is grouped with the consumer discretionary sector for investing purposes. Tesla's main rivals include established automakers such as Ford Motor Co. (F) and General Motors Co. (GM), as well as newer, fast-growing electric vehicle makers like Lucid Group Inc. (LCID) and China-based NIO Inc. (NIO). In FY 2021, ended Dec. 31, 2021, Tesla posted net income of $5.6 billion on revenue of $53.8 billion.

Key Takeaways

  • Tesla designs, builds, and sells electric vehicles, as well as energy generation and storage systems.
  • Tesla's rivals include major automakers such as Ford Motor Co. (F) and General Motors Co. (GM), as well as rising electric vehicle makers like NIO Inc. (NIO).
  • In FY 2021, ended Dec. 31, 2021, Tesla posted net income of $5.6 billion on revenue of $53.8 billion.
  • On April 2, 2022, Tesla reported its Q1 2022 vehicle deliveries were up 68% from a year earlier.

Tesla's Recent Developments

  • On April 20, 2022, Tesla reported Q1 2022 net income of $3.3 billion, a quarterly record that exceeded Wall Street estimates, as revenue surged 81% year-over-year to $18.8 billion.
  • On April 2, 2022, Tesla reported it delivered 310,048 vehicles in Q1 2022, up 68% from a year earlier.
  • On March 28, 2022, Tesla disclosed plans for a stock split, conditional on stockholder approval expanding the company's authorized number of shares at its 2022 annual meeting. It did not specify a date or ratio for the expected split.
  • On March 22, 2022, Tesla officially opened its German plant near Berlin, supplementing auto assembly plants in Shanghai, Texas and California.
  • By Dec. 28, 2021, Musk disclosed Tesla stock sales totaling $16.4 billion since early November, amounting to nearly 10% of his stake in the company.
  • On Dec. 1, 2021, Tesla said it completed the move of its headquarters to Austin, Texas, where the company's newest car plant started production late in the year.

What's Happening With Tesla's Recalls?

Tesla has issued multiple vehicle recalls in recent months. On April 12, 2022 the company announced a recall of 594,894 vehicles, including models Y, X, and S made in 2020-2022 and Model 3's from 2017-2022, to disable the Boombox function when the car is not parked lest it drown out pedestrian warning signals. On Feb. 1, 2022, Tesla announced a recall of 817,143 vehicles, including 2021-2022 Model S and Model X, 2017-2022 Model 3, and 2020-2022 Model Y, because the audio reminder to buckle seat belts may not work as required.



What's Happening With Tesla's Cybertruck?

On Aug. 7, 2021, Tesla announced that its electric pickup truck, the Cybertruck, will not be released until 2022, after initially being scheduled to come out in late 2021. The truck has been hampered by design issues, and also by supply chain challenges related to the pandemic. On April 7, 2022, Musk said the Cybertruck would debut in 2023, and would be assembled at the company's recently opened plant in Austin, Texas.

What's Happening With Tesla and Bitcoin?

On May 12, 2021, Musk announced on Twitter that Tesla would stop accepting Bitcoin payments for its vehicles, citing concerns over "rapidly increasing use of fossil fuels" for Bitcoin mining and transactions. On June 13, 2021, Musk tweeted that Tesla would again accept Bitcoin when approximately 50% of its mining is done with clean energy. On July 21, 2021, Musk gave more detail at a conference regarding when Tesla will accept Bitcoin. The CEO said the company would "most likely" resume accepting Bitcoin, pending due diligence to confirm that the percentage of renewable energy used to make Bitcoins is "at or above 50%," and on an upward trend.

What's Happening With Tesla's Car Radar?

In May 2021, Tesla announced that it would no longer include radar sensors on its Model 3 and Model Y cars manufactured for sale in North America. The decision caused Consumer Reports to pull its “Top Safety Pick+” designation from the Model 3, and the National Highway Traffic Safety Administration (NHTSA) said that the radar-less vehicles will no longer get a check mark for a number of categories, including dynamic brake support. Consumer Reports and the Insurance Institute for Highway Safety (IIHS) restored their highest safety endorsements for Tesla Model 3s on June 29.

What's Happening With Elon Musk and the SEC?

In September 2018, Tesla and CEO Musk settled a civil securities fraud suit brought by the U.S. Securities and Exchange Commission (SEC). As part of the settlement, Musk stepped down as chair of the board and the company agreed to corporate governance reforms, other changes, and a total of $40 million in fines for Musk and the company. The SEC had alleged that a Twitter post by Musk outlining plans to take Tesla private "lacked an adequate basis in fact." The SEC also charged Tesla with "failing to have required disclosure controls and procedures relating to Musk’s tweets."


On June 1, 2021, The Wall Street Journal reported that Musk had twice violated a court order requiring that all his tweets be pre-approved by Tesla lawyers. On March 8, 2022, Musk sued to end the SEC settlement condition requiring company lawyers to approve his tweets containing material business information, alleging it infringes his freedom of expression. On April 14, 2022, Musk called SEC regulators "bastards" for bringing the charges settled in 2018.

What's Happening With the Tesla Shareholder Lawsuit About Solar City?

On July 12–13, 2021, Musk testified in a lawsuit brought by Tesla shareholders. The plaintiffs alleged that he used Tesla's 2016 acquisition of SolarCity to bail out SolarCity while chairing both companies’ boards. Closing arguments in the case took place in January 2022, with lawyers for the plaintiffs arguing Musk should return the Tesla shares he received for his SolarCity stock, valued as of January 2022 at $13 billion. A ruling in the case remained pending as of April 21, 2022.

FAQs

Has TSLA ever split its stock?

Tesla has split its stock once. Effective Aug. 31, 2020 it executed a 5-for-1 split of common shares. As noted above, the company plans to seek shareholder approval to increase the number of authorized shares in order to carry out another stock split, with no date or ratio yet specified.

Does TSLA pay a dividend?

No, it does not pay a dividend.

How many shares of TSLA stock are there?

Tesla had approximately 1.13 billion shares outstanding as of Q1 2022.

Who Is Tesla's CEO?

Tesla's CEO is Elon Musk. Musk made a significant early investment in the company the year after it was founded. Under his leadership, the company has grown from a money-losing startup into a profitable, large automaker and a global leader in electric vehicles. He was chair of the company's board until resigning as part of a settlement with the SEC in 2018. Musk became CEO in October 2008.

What Positions Does Elon Musk Hold at Tesla?

In addition to the title of chief executive officer, Elon Musk was given the title of "Technoking of Tesla" in 2021.

Who Are Tesla's Top Shareholders?

As of Dec. 15, 2020, Tesla's top individual insider shareholders are Kimbal Musk, Zachary Kirkhorn, and Jerome M. Guillen, and its top institutional shareholders are Elon Musk, Susquehanna Securities, and Capital World Investors.

Article Sources

Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. CNET. "Tesla Motors Founders: Now There Are Five."

  2. Tesla Inc. "Tesla Announces Pricing of Initial Public Offering."

  3. Tesla, Inc. "Elon Musk."

  4. U.S. Securities and Exchange Commission. "Tesla Inc. Form 10-K for the Fiscal Year Ended Dec. 31, 2021."

  5. Tesla Inc. "Q1 2022 Update," Page 4.

  6. The Wall Street Journal. "Tesla Posts Record $3.3 Billion Quarterly Profit."

  7. Tesla Inc. "Tesla Vehicle Production & Deliveries and Date for Financial Results & Webcast for First Quarter 2022."

  8. CNBC. "Tesla Delivers 310,048 Electric Vehicles in the First Quarter."

  9. U.S. Securities and Exchange Commission. "Tesla Inc. Form 8-K, March 28, 2022."

  10. CNBC. "Elon Musk Breaks Out the Dance Moves As He Opens New Tesla Factory in Germany."

  11. U.S. Securities and Exchange Commission. "Tesla, Inc. Form 8-K, Dec. 1, 2021."

  12. KVUE. "Tesla Announces Start of Production in Austin During Earnings Meeting."

  13. National Highway Traffic Safety Administration. "Pedestrian Warning Sound May Be Obscured."

  14. National Highway Traffic Safety Administration. "Seat Belt Chime May Not Activate."

  15. Car and Driver. "Elon Musk Promises Tesla Cybertruck in 2023 at Giga Texas Plant Opening Party."

  16. Reuters. "Tesla’s Musk Halts Use of Bitcoin for Car Purchases."

  17. Twitter. “@elonmusk 1:42 PM • Jun 13, 2021.”

  18. Reuters. "Tesla Will 'Most Likely' Restart Accepting Bitcoin as Payments, Says Musk."

  19. TechCrunch. “Tesla Has Activated Its In-Car Camera to Monitor Drivers Using Autopilot.

  20. Consumer Reports. "Tesla Model 3 Loses CR Top Pick Status and IIHS Safety Award After Dropping Features."

  21. Consumer Reports. "Tesla Model 3 Regains CR Top Pick Status and IIHS Safety Award."

  22. National Highway Traffic Safety Administration. “2021 Tesla Model 3.”

  23. U.S. Securities and Exchange Commission. "Elon Musk Settles SEC Fraud Charges; Tesla Charged With and Resolves Securities Law Charge."

  24. Wall Street Journal. "Tesla Failed to Oversee Elon Musk’s Tweets, SEC Argued in Letters."

  25. CNBC. "Musk Seeks to End SEC Settlement That Required Preapproval for Some Tweets."

  26. Reuters. "Musk Says U.S. SEC 'Bastards' Forced Settlement Over Tesla Tweets."

  27. Reuters. "Tesla Investors Urge Judge to Order Musk Repay $13 Bln for SolarCity Deal."

  28. Tesla Inc. "Tesla Announces a Five-for-One Stock Split."

  29. Tesla Inc. "Investor FAQs."

  30. Tesla Inc. "Q1 2022 Update," Page 23.

  31. TheStreet. "History of Tesla: Timeline and Facts."

  32. CNBC. "Elon Musk: ‘I Really Didn’t Want to Be CEO of Tesla’—Here’s How He Says It Happened."

  33. Forbes. "Tesla CEO Elon Musk Has A New Title: ‘Technoking’."

Take the Next Step to Invest
×
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.
Service
Name
Description