The bad news came in a largely positive earnings report in which the company reported record earnings and revenue up 37%, beating forecasts, even though its margins fell.
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Tesla took a $140 million loss on its Bitcoin investment in 2022.
In its annual 10-K filing with the Securities and Exchange Commission, the electric car maker confirmed it had actually booked a loss of $204 million last year, but also made $64 million trading BTC.
The bad news came in a largely positive earnings report in which the company reported record earnings and revenue up 37%, beating forecasts, even though its margins fell.
In early 2021, Tesla CEO Elon Musk bought $1.5 billion worth of BTC for the company's treasury. Even though it made a hefty profit on the year, accounting rules forced it to write down the value of its holdings by $101 million that year. That's because its value must be marked down to the lowest value it reaches, even though gains cannot be recorded until the asset is sold.
"For any digital assets held now or in the future, these charges may negatively impact our profitability in the periods in which such impairments occur even if the overall market values of these assets increase," Tesla said.
Backpeddling BTC
The company actually sold 75% of its BTC holdings last July for just $936 million — a substantial loss — in a move that Musk attributed to a need to strengthen its cash position due to uncertainties over the impact of COVID on its manufacturing in China.
It was not, he said, a "verdict" on Bitcoin.
Tesla has had an uneven history with BTC. Shortly after announcing the Bitcoin purchase, Musk said the company would begin accepting the first cryptocurrency in payment for cars — a first for a major brand.
But he reversed that March decision in May, citing the environmental costs of mining. That caused speculation from Wall Streeters like Ark Investment's crypto-friendly Cathie Wood that Musk had run into serious pushback from big environmental, social and governance (ESG) investors that forced him to backpeddle.
