Tesla Held Onto Its Bitcoin Stash In Q1 Despite Taking A $178M Tax Hit – TSLA Stock Slides Pre-Market

• Tesla recorded a $173 million after-tax loss tied to its Bitcoin holdings due to a price decline.
• It maintained its Bitcoin position at 11,509 BTC with no sales during the quarter.
• The value of its Bitcoin holdings stood at approximately $786 million at quarter-end, according to filings.

Tesla (TSLA) shares tumbled on Thursday morning after the Elon Musk-led company reported that it hadn’t sold any of its Bitcoin (BTC) holdings since last year, but took a $173 million tax hit due to the dip in BTC’s price in the first quarter.

TSLA’s stock dropped as much as 3.5% in pre-market trade despite reporting an earnings beat as concerns over free cash flow weighed on investors’ sentiment. 

Retail sentiment around the EV maker on Stocktwits fell to ‘bullish’ from ‘extremely bullish’ territory over the past day, while chatter rose to ‘high’ from ‘normal’ levels. 

The company reported adjusted earnings per share (EPS) of $0.41 for the first quarter (Q1), beating Wall Street’s estimate of $0.36, as per Koyfin data. Revenue came in at $22.39 billion, at par with expectations. Tesla stated that its capital expenditure is slated to exceed $25 billion this year as it ramps up spending across autonomy, robotics, chip development and manufacturing.

Tesla’s Bitcoin Bet Unmoved Despite $173M Loss

Tesla said it did not sell any of its Bitcoin holdings during the quarter. However, the decline in Bitcoin’s price from $90,000 to around $68,000 resulted in a $173 million after-tax impairment. The company reported the value of its Bitcoin holdings at $786 million at the end of the quarter.

Tesla first entered the Bitcoin market in February 2021, purchasing 43,200 BTC for around $1.5 billion. The company sold about 10%, amounting to around 4,320 BTC, a month later to test market liquidity. 

In 2022, amid the crypto winter, Tesla brought its Bitcoin holdings down to 9,720 BTC. Last in January, it made a small purchase, lifting its Bitcoin accumulation to 11,509 BTC.

Bitcoin’s price fell nearly 1% in the last 24 hours to around $77,400, putting the value of Tesla’s Bitcoin stash at around $891 million at current prices. Retail sentiment around the apex cryptocurrency trended in ‘bullish’ territory over the past day, while chatter rose to ‘high’ from ‘normal’ levels.

BTC’s price remains nearly 40% below its record high of over $126,000 seen in October.

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