Tesla Takes Advantage of New FASB Rule, Posts $600M Gain on Bitcoin Holdings in Q4
Tesla (TSLA) appears to have utilized a new accounting rule allowing corporate owners of digital assets to mark them to market, showcasing a significant increase in the value of its Bitcoin holdings.
According to Tesla’s fourth-quarter earnings report, the company’s 9,720 Bitcoin were valued at $1.076 billion as of the end of 2024, a sharp rise from the $184 million valuation it had maintained in previous quarters. This adjustment contributed to a $600 million boost to Tesla’s GAAP income, out of a total of $2.3 billion in GAAP income for the quarter.
The new rule, introduced by the Financial Accounting Standards Board (FASB), mandates that companies holding digital assets must mark those assets to market on a quarterly basis starting in the first quarter of 2025. However, companies had the option to adopt this rule early, which Tesla appears to have done.
Before this change, corporate holders of digital assets were required to report the lowest value of their holdings during the ownership period.
Tesla’s adjusted earnings per share (EPS) for the quarter came in at $0.73, falling short of the expected $0.76. However, the gain from its Bitcoin holdings impacted GAAP income and did not affect adjusted EPS. Following the earnings report, Tesla’s shares rose 3.5% in after-hours trading.
With 9,720 BTC, Tesla remains the sixth-largest publicly traded company to hold Bitcoin on its balance sheet, according to Bitcoin Treasuries.
