In its Q1 report, Tesla revealed that it had not made any changes to its Bitcoin holdings, which remained at around 11,950 BTC, equivalent to approximately $350 million. This news comes after the e-car maker sold 75% of its Bitcoin holdings in June 2022, converting them into fiat currency and adding $936 million to its cash reserves.
Tesla‘s initial investment in Bitcoin, made in February 2021, was a bold move that significantly impacted the cryptocurrency market. The investment saw Tesla purchase $1.5 billion worth of Bitcoin, which pushed the price of the cryptocurrency to new heights.
However, the bet on Bitcoin did not pay off as Tesla had hoped. The company’s Q1 earnings report revealed a slight dip in sales, which came in at $23.33 billion compared to the estimated $23.39 billion. Despite this, the company still met earnings per share (EPS) expectations of $0.85.
Despite the sales miss, investors seemed unfazed, with Tesla’s shares trading only marginally lower in after-hours trading. This is likely since Tesla’s overall financial position remains strong, with the company’s cash reserves bolstered by the sale of its Bitcoin holdings.
It remains to be seen whether Tesla will make any further investments in Bitcoin or other cryptocurrencies in the future. While the initial investment had a significant impact on the market, the subsequent sale of the majority of Tesla’s Bitcoin holdings suggests that the company may not view cryptocurrency as a viable long-term investment option.
In any case, Tesla’s Q1 earnings report serves as a reminder that even the most audacious bets can sometimes fail to pay off and that businesses must carefully consider the risks and benefits of any investment decisions they make.
