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Tesla (NASDAQ:TSLA) reported a significant gain in its bitcoin holdings for the fourth quarter of 2024, attributing a $600 million increase to an updated accounting rule by the Financial Accounting Standards Board. This new rule allows companies to adjust the value of their digital asset holdings based on market prices each quarter. Previously, firms were only able to write down the value of crypto assets if they depreciated, without the ability to revalue them upwards unless sold.
The change in accounting practices led to Tesla’s digital asset holdings value surging to $1.076 billion by the end of 2024, a substantial rise from $184 million in the previous quarter. The increase was bolstered by a more than 50% growth in bitcoin’s value during the last three months of the year. Factors contributing to this surge included the reelection of crypto advocate Donald Trump as U.S. President and robust activity in spot bitcoin exchange-traded funds.
At present, bitcoin is trading at $105,020, marking a 2.88% rise over the past 24 hours. Despite this, Tesla has not disclosed the exact size of its bitcoin holdings in its Q4 report. However, data from Arkham Intelligence estimates Tesla’s bitcoin stash to be approximately 11,509 BTC, valued at around $1.21 billion. This positions Tesla as the fourth largest publicly traded holder of bitcoin, trailing behind MicroStrategy, Marathon Digital (NASDAQ:MARA), and Galaxy Digital (TSX:GLXY).
The boost from digital assets contributed to Tesla’s generally accepted accounting principles (GAAP) net income of $2.3 billion for the fourth quarter. For the entire year of 2024, the company reported a net income of $7.1 billion. However, Tesla’s adjusted earnings-per-share were reported at $0.73, slightly below the anticipated $0.76.
Following the news, Tesla shares experienced a downturn, closing down 2.26% at $389.1. Nevertheless, the stock demonstrated resilience, rebounding by 4.15% in after-hours trading.
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