Elon Musk Seeks $1 Trillion Tesla Pay, Slams Advisory Firms

Elon Musk recently intervened on Tesla's earnings call, pleading with investors to approve his $1 trillion pay package. Hijacking Tesla's earnings call near the end, the world's richest person also slammed shareholder advisory firms that advised against the proposal.

Key Highlights

• Elon Musk defends $1 trillion pay package, criticizes advisory firms ISS and Glass Lewis.
• Tesla board chair Robyn Denholm urges shareholders to approve Musk's compensation plan.

His intervention came in an otherwise one-dimensional call, which focused primarily on Tesla's artificial intelligence, humanoid robot, and self-driving initiatives.

"There needs to be enough voting control to give a strong influence, but not so much that I can't be fired if I go insane," Elon Musk said, interrupting the chief financial officer as the more than hour-long call came to a close.

Tesla shareholders will vote on Elon Musk's $1 trillion pay package on November 6.

Tesla's Q2 earnings

Tesla's earnings report was largely disappointing, with profit missing expectations despite record vehicle deliveries. Operating income fell 40% in the third quarter, indicating ongoing pressures on an electric-vehicle industry buffeted by shifting US policies.

Tesla's costs are rapidly rising, with tariffs costing the company more than $400 million in the fourth quarter. Operating expenses increased by 50% to $3.4 billion during the period.

Tesla shares fell up to 5.7% shortly after the start of regular trading on Thursday. The stock is up nearly 9% year to date, trailing the S&P 500 Index's 14% gain.

Also Read: Musk Reveals Tesla's Bold AI and Robotaxi Plans

‘Unmitigated Concerns’

Institutional Shareholder Services and Glass Lewis have advised investors to reject Musk's unprecedented payout, the value of which is dependent on Tesla meeting market value thresholds and operational milestones. ISS expressed "unmitigated concerns" about the size and design of the award, while Glass Lewis questioned its potential to dilute other shareholders' ownership.

Musk emphasized, as he has in the past, that adequate voting control is more important to him than financial compensation from Tesla.

"I just don't feel comfortable building a robot army here and then being kicked out because of some asinine recommendations from ISS and Glass Lewis, who have no freaking clue," he explained.

After Musk finished, Tesla CFO Vaibhav Taneja resumed his closing remarks, praising the special board committee's "amazing job" in creating the award.

"Nothing is passed on until shareholders make substantial returns," Taneja said, urging shareholders to vote in favor of the plan twice more.

Musk, 54, is ranked first on the Bloomberg Billionaires Index, with a net worth of approximately $455 billion.