In its earnings report, Tesla revealed that it has sold approximately 75% of its bitcoin purchases and took an impairment.
"As of the end of Q2, we have converted approximately 75% of our Bitcoin purchases into fiat currency. Conversions in Q2 added $936M of cash to our balance sheet," the company said in the earnings presentation.
It doesn't outline how large the impairment was. At the end of 2021 Tesla held about $2 billion worth of BTC and was reported at 43,200 bitcoin. It's fallen about 50% since then. Initial purchases averaged $32,610 but some was added later and there was a stream of different prices when the company was accepting bitcoin payments.
The $963 million number suggests a roughly $1 billion loss since the turn of the year.
In terms of earnings , the EPS at $2.27 beat the estimate of $1.80 while revenue was at 16.934 billion compared to 17.2 billion expected. A year ago revenues were at $11.958 billion.
Gross margin was at 27.9% compared to 28.4% last year. Exclude zero-emission credits and it falls to 26.2%.
For the broader market, the comments in the conference call will be interesting. Recently he said he had a 'super bad' feeling about the economy.
Shares have rallied initially after the report to $769 from $741 at the close.
On July 14, Musk said "I might pump, but I don't dump."
I guess not but it's looking like they sold at the lows. Bitcoin appears to be taking this news badly and has fallen back to $23,000.