Musk to Receive $29 Billion in Tesla Stock Despite Pay Package Revocation

Tone & Political Bias: Center

Why: The article presents a straightforward summary of regulatory filings, court rulings, and financial details without favoring Musk, Tesla, or their critics.

What’s New

Tesla is awarding CEO Elon Musk 96 million shares of restricted stock, worth about $29 billion, according to a regulatory filing on Monday. The move comes just six months after a Delaware judge ruled that Musk’s original 2018 compensation package must be revoked.

The new award has drawn attention due to the ongoing legal battles over Musk’s pay, the company’s stock performance, and concerns from shareholders about corporate governance.

Background

In December 2023, Delaware Chancellor Kathaleen St. Jude McCormick ordered Tesla to cancel Musk’s 2018 pay package, which at one point was valued at $56 billion. The judge ruled that the deal was pushed through by a board that lacked independence and that the negotiation process was flawed.

McCormick also rejected a request by plaintiff attorneys to be paid in Tesla stock worth $5 billion. Instead, she approved $345 million in legal fees. The lawsuit was brought by a Tesla shareholder who challenged the fairness of Musk’s 2018 pay agreement.

What The Filing Says

Tesla’s new stock grant for Musk allows him to purchase shares at $23.34 each — the same exercise price as the revoked 2018 deal. Tesla did not specify whether this new grant replaces the old package or is subject to the outcome of Musk’s appeal, which he filed in March 2025. The company also said in April that it had formed a special committee to review Musk’s compensation.

Shareholder Reactions

Some Tesla investors see the new grant as a necessary step to secure Musk’s long-term commitment to the company.

“We believe this grant will now keep Musk as CEO of Tesla at least until 2030 and removes an overhang on the stock,” said Dan Ives, a Wedbush analyst, in a client note.

However, not all shareholders are satisfied. A group of over 20 Tesla shareholders, frustrated by the company’s stock decline and public scrutiny, recently demanded more transparency and legal compliance, particularly concerning the upcoming annual shareholder meeting now scheduled for November.

Financial Context

Tesla stock has fallen by 25% so far this year. The decline is driven partly by increasing concern over Musk’s political involvement — specifically, his alignment with President Donald Trump — and partly by weak earnings and increased market competition.

In its most recent quarterly report, Tesla posted:

• A drop in profit from $1.39 billion to $409 million

• Lower-than-expected revenue

• Missed Wall Street expectations even after forecasts were lowered

  
  

Political Scrutiny And Corporate Governance

Investor concerns have been growing as Musk has spent significant time in Washington this year, reportedly playing a key role in the Trump administration’s efforts to downsize federal government operations. This political involvement has led to questions about how engaged Musk remains in Tesla’s operations, especially during a time of market competition and internal restructuring.

What’s Next

Musk’s appeal to reinstate the 2018 compensation package is ongoing. Meanwhile, Tesla’s newly disclosed stock grant and the upcoming November shareholder meeting will likely serve as key flashpoints for both investor confidence and regulatory scrutiny. Tesla’s stock rose over 2% in pre-market trading following the announcement.