Elon Musk has sold millions more shares of Automaker Tesla this week, according to filings with the US Securities and Exchange Commission.
Musk sold 22 million shares of Tesla worth $3.6 billion. Combined, the billionaire CEO has offloaded almost $40 billion shares of his prized electric car maker this year, bringing his stake in the company down from 17% a year ago, to 13.4% now, according to Refinitiv data.
This week marked the second major offload of shares since Musk’s purchase of social media company Twitter in October. One month ago, he dumped 19.5 million shares, bringing in $3.95 billion. Tesla’s stock price has taken a hit along with the rest of the market, but investors are also worrying that since he took over Twitter, Musk has not been able to devote his full attention to managing the electric vehicle maker. Shares are now trading at two-year lows.
Tony Sycamore, an analyst at IG Markets brokerage, said in an interview, “It doesn’t put a lot of confidence in the business, or speak volumes for where his attention is at. It’s not a good situation. I’ve spoken to a lot of investors who have Tesla shares and they’re absolutely furious at Elon.”
Analysts are predicting that Musk may have to sell additional Tesla stock to finance the Twitter purchase. Although he had originally planned to finance the deal himself, Musk was able to locate $20 billion in additional investment from private investors and banks.
While Musk paid top dollar for the company, experts are predicting it may take even more in sweat equity to keep Twitter afloat financially. Due to Musk’s professed intent to reduce content moderation, a raft of advertisers either exited the platform, or placed their advertising on hold, until they could get a better idea of what Musk’s “Twitter 2.0” would look like. Advertisers had been Twitter’s major source of income.
Although some major advertisers like Apple and Amazon have returned, in November the platform had been losing $4 million per day per Musk’s statements. According to a report from market research firm Insider Intelligence, Twitter’s revenue growth will be flat over the next two years, due to a reduction in monetization.
