Elon Musk’s massive payout is being decided by the Tesla Board of Directors as he is looking to pocket a huge bonus. Elon does not receive a cash payout or any type of bonus but he is paid in stock options instead.
Elon Musk, the company’s CEO, does not earn a monetary salary or incentive. He’s solely paid in stock options. According to Courtney Yu, director of research at executive compensation firm Equilar, he has nearly exhausted the options available from the compensation package he received from Tesla in 2018, a package that turned out to be the most valuable package of stock options awarded by any corporation.
After factoring in the exercise price, the 93.9 million options Musk has gotten so far from the deal were valued at $86.8 billion as of Friday’s close.
Due to Tesla’s record earnings on Wednesday, Musk received 25.3 million of those options just this week. Based on analyst sales predictions, he’ll likely earn another 8.4 million options soon, most likely after the business reports its second or third-quarter results.
However, those 8.4 million options, worth billions, represent a modest percentage of what Musk could collect in the end. He will have received all 101 million split-adjusted options included in that 2018 salary package once he receives those additional options. The question should be whether he will be given even more options, possibly tens of millions.
Musk dodged a question about such a payday during an investor call Wednesday, saying simply, “There are no discussions currently underway for incremental compensation for me.”
Other CEOs prefer to get a payday instead of stick options including Jeff Bezos, the founder of Amazon, and Mark Zuckerberg, the founder of Facebook. Bezos gets about $81,000 a year and Zuckerberg gets $1. Their profit comes to from their shares.