Tesla’s 2025 CEO award could deliver Elon Musk 423,743,904 performance-based restricted shares, but only if he meets a demanding set of company-value, operating, service and holding conditions. TechCrunch’s description of the award’s product milestones as “watered-down” rests on a specific contrast: several targets are cumulative totals where Musk had previously described annual output or a much earlier deadline. The award does not require Tesla to deliver 20 million vehicles a year, for example; its formal target is 20 million vehicles delivered in total.
Is Musk’s new Tesla pay package really worth $1 trillion?
Not as a guaranteed cash payment. Tesla’s fiscal 2025 Form 10-K says the board granted about 423.7 million performance-based restricted shares on September 3, 2025, and shareholders approved the 2025 CEO Performance Award on November 6, 2025. The “$1T” label is a potential or illustrative valuation, not an independently established final amount Musk will realize.
The shares are subject to tranche-specific restrictions and conditions. Tesla’s filing also describes a share offset, voting treatment, service requirements and a five-year holding requirement. The size of the award therefore should not be read as cash already paid or as a simple promise to transfer shares regardless of results.
What does Musk have to do to earn the award?
The award contains 12 tranches of 35,311,992 shares each, totaling 423,743,904. Earning the tranches depends on meeting market-capitalization and operational milestones, along with service conditions. Tesla’s filing describes market-capitalization thresholds from $2 trillion to $8.5 trillion, measured using trailing averages and specified measurement provisions. The last two steps are $7.5 trillion and $8.5 trillion.
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Operational conditions include four product or strategic targets and a series of Adjusted EBITDA thresholds. In general, successive tranches require meeting the corresponding number of operational milestones; the final tranches also require board approval of a CEO succession framework.
| Condition | Formal award target | What the target means |
|---|---|---|
| Vehicle deliveries | 20 million | Total vehicles delivered, not a stated annual production target. |
| FSD subscriptions | 10 million active subscriptions | A subscription-count milestone; Tesla’s current count is not established by the sources cited here. |
| Bots | 1 million delivered | Total deliveries under the award definition, not a stated annual production target. |
| Robotaxis | 1 million in commercial operation | Measured as a daily average over a consecutive three-month period; the definition includes Tesla vehicles using FSD in a transportation service, not just purpose-built Cybercabs. |
| Adjusted EBITDA | $50 billion, $80 billion, $130 billion, $210 billion, $300 billion, and three separate $400 billion periods | The final three thresholds must be achieved in three non-overlapping four-quarter periods. Tesla’s filing defines Adjusted EBITDA. |
The thresholds work together: the product targets alone do not earn the full award. The market-capitalization and financial targets, service terms, holding restrictions and succession condition are also part of the package.
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Where do the award targets differ from Musk’s earlier promises?
TechCrunch compared the formal award definitions with earlier public ambitions attributed to Musk. The central distinction is whether a number describes output per year or a cumulative total, and whether the award specifies a deadline or a measurement period.
| Area | Earlier public ambition reported by TechCrunch | 2025 award milestone | Key difference |
|---|---|---|---|
| Vehicles | 20 million vehicles a year by 2030 | 20 million vehicles delivered in total | The award’s threshold is cumulative, not 20 million per year. TechCrunch also notes Tesla had previously walked back the annual goal. |
| Robotaxis | In 2019, Musk said there would be one million robotaxis on the road in 2020 | One million robotaxis in commercial operation | The award uses a daily average over three consecutive months and a definition that can include Tesla vehicles using FSD in a transportation service. It does not restrict the count to Cybercabs. |
| Optimus bots | One million Optimus bots made annually by 2029 | One million bots delivered in total | The award target is cumulative, not annual. Its definition covers a robot or other mobile physical product using AI and manufactured by or for Tesla, excluding vehicles. |
| FSD | No earlier numerical goal is specified in the comparison summarized by TechCrunch | 10 million active subscriptions | TechCrunch called this arguably the most ambitious product target and reported Tesla had not disclosed a subscriber count in the reporting it reviewed. A current count is not established here. |
That comparison supports describing the formal targets as less expansive than some earlier rhetoric, but it does not make the award easy to earn. The milestones still require enormous scale, and the financial and market-value conditions stand alongside the product targets. “Watered-down” is TechCrunch’s interpretation of the comparison, not a formal finding by Tesla’s board or the SEC.
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How does the new award compare with Musk’s 2018 package?
Tesla’s 2018 proxy described a 10-year performance award as Musk’s only compensation, with no guaranteed salary, cash bonus or time-based equity. The final milestone required a market capitalization of at least $650 billion plus operational achievements. Tesla said Musk and Kimbal Musk recused themselves from the board process after discussions with Musk.
The new award follows a similar pay-for-performance structure, but its company-value thresholds are measured in trillions and its operational measures reflect Tesla’s later focus on vehicles, autonomy and robotics. The comparison is not simply between a smaller and larger headline number: each award has its own milestones and conditions.
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Tesla’s fiscal 2025 Form 10-K reports that the Delaware Supreme Court reversed the Court of Chancery’s rescission order and reinstated the 2018 award. Tesla also says its Special Committee continued evaluating retention and incentive matters, including the 2018 award and the 2025 interim award. An Associated Press report in 2024 described the 2018 plan’s potential value as $55.8 billion; that was a historical estimate, not the current value of either package.
What the headline value does—and does not—tell you
A headline valuation cannot tell a reader how many shares Musk ultimately earns, whether every condition will be met, or what the shares would be worth when restrictions permit a sale. The operative facts are the grant size and the award’s milestone, service, voting, offset and holding provisions. Tesla’s proxy materials describe the award as conditional; the board’s shareholder presentation said, “Generally, if Elon fails to achieve incredibly ambitious market capitalization AND operational milestones Elon earns nothing.” That is Tesla’s advocacy language, rather than an independent assessment of the package.
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Likewise, Tesla’s 2018 proxy called the earlier award “a 100% at-risk performance award” and said Musk would be compensated only if Tesla and its stockholders did extraordinarily well. That is the company’s description of its own plan, not a neutral valuation of either award.
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