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Tesla (TSLA) hit from Bitcoin sale & impairment amounted to $106 million in Q2 2022

Tesla has revealed that its Bitcoin liquidation cost the company $106 million.

July 20, 2022 3:08 PM

In Tesla’s (TSLA) Q2 2022 earnings report, the company announced that it had liquidated 75 percent of its Bitcoin holdings. The move brought in $936 million for the company’s balance sheet, and helped its cashflow stay in the positive for the previous quarter. However, it was unknown how much this move cost the company overall. Tesla CEO Elon Musk followed up on that point during the Q2 2022 earnings call, providing a reason for the sale and revealing that Tesla took a $106 million hit on its Bitcoin liquidation.

The Tesla (TSLA) Q2 2022 earnings call took place not long after the company published its earnings report for the quarter. During the call, Tesla CEO Elon Musk was asked by investors for more details surrounding Tesla’s move to sell 75 percent of its Bitcoin. He directly cites the shutdown of the factory in Shanghai due to COVID-19 and its financial impact as a cause for the sale. “We were uncertain when the COVID lockdowns would end in China, so we sold Bitcoin.” He went on to share that Tesla has not sold any of its Dogecoin.

elon musk speaks on tesla's bitcoin sale — Tesla took a $106 million hit on its Bitcoin sale.

Musk also informed investors that Tesla lost a total of $106 million in parting with its Bitcoin. That said, it could probably be argued whether or not the move was worth it, seeing how strong of an impact it had on Tesla’s cash flow for Q2 2022. Musk also reassured that Tesla may look to add to its Bitcoin position in the future.

Elon Musk’s comments during Tesla’s latest earnings call clears up some questions that had been floating since the Q2 2022 earnings report went live. During the same call, Musk referred to the lithium refining business as a “license to print money.” Be sure to stay with Shacknews for more updates out of Tesla’s earnings call.

Donovan Erskine

News Editor

Donovan is a young journalist from Maryland, who likes to game. His oldest gaming memory is playing Pajama Sam on his mom's desktop during weekends. Pokémon Emerald, Halo 2, and the original Star Wars Battlefront 2 were some of the most influential titles in awakening his love for video games. After interning for Shacknews throughout college, Donovan graduated from Bowie State University in 2020 with a major in broadcast journalism and joined the team full-time. He is a huge Scream nerd and film fanatic that will talk with you about movies and games all day. You can follow him on twitter @Donimals_

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July 20, 2022 3:08 PM

Donovan Erskine posted a new article, Tesla (TSLA) hit from Bitcoin sale & impairment amounted to $106 million in Q2 2022
- beepboopbeep
  
   reply
  July 20, 2022 3:19 PM
  
  that's not too bad. only a 10% drop. Good thing they got out at that time, cause it could have been much worse - the cryptos were going down 50%+ at one point
  - beepboopbeep
    
     reply
    July 20, 2022 3:20 PM
    
    I also think that there's a high potential that Tesla selling the bitcoins was one of the causes of the bitcoin crash. The market is so small that any moves like this would alter the pricing on the market in general.
    - beepboopbeep
      
       reply
      July 20, 2022 3:21 PM
      
      (ie they sold about a billion worth of bitcoins, that is pretty much the definition of a market making move - causing sell offs, etc and ripple effects down stream)