Tesla hides $97M Bitcoin loss in adjusted earnings report

Tesla Inc reported its worst quarter in years but but it wouldn’t be possible to guess that from its “adjusted earnings.” The EV giant reported adjusted (non-GAAP) earnings of $900 million, more than double its official net income of $400 million.

It seems like Tesla pulled a rabbit out of an earnings hat and it had crypto written all over it. The EV giant quietly scrubbed out $97 million in crypto losses and tossed out a bigger chunk of stock-based compensation. This comes in when its CEO, Elon Musk, stated that he would cut back the time that he gives in to the Trump administration.

Tesla still holds over $1B in Bitcoin

This isn’t the first time that Elon Musk led Tesla to use digital assets to dress up the numbers. When Bitcoin rallied in late 2024, Tesla included a $600 million gain in its non-GAAP figures. Meanwhile, it still holds over $1 billion in Bitcoin and that might be the most stable part of its Q1 earnings.

According to the latest report, Tesla owns 11,509 BTC, valued at around $1.049 billion based on Arkham Intelligence data. This comes in the wake of new FASB accounting rules, which require companies to mark their crypto holdings to market each quarter.

The markdown wasn’t due to any sales drop, but rather reflecting Bitcoin performance in the first quarter. BTC price saw a downturn of 11.82% in this period. The biggest crypto is still down by 10% over the past 90 days. However, it has posted a recovery of 11% in the last 7 days. Bitcoin is trading at an average price of $93,660, at press time.

The global digital assets industry is riding the recovery wave for now as the cumulative crypto market cap inches closer to the $3 trillion mark.

Tesla shares up despite Q1 miss

Tesla also missed Wall Street’s expectations by pulling in $19.34 billion in Q1 revenue against the $21.37 billion analysts had forecast. Despite the undesirable earnings report, Tesla share price jumped by 6.5% in the last 5 trading sessions. It is trading at the average price of $259, while the share price is up by 4.5% in the pre-market session and might hit $264 later in the day.

The US Securities and Exchange Commission (SEC) might plan to look into the matter as the watchdog has flagged similar practices before. The commission will likely keep a close eye on Tesla if it decides to suddenly include crypto gains in future quarters. Last year, the agency flagged Bitcoin miner Marathon Digital for similar creative trimming.

As of now, Musk is reportedly stepping back from the D.O.G.E team as Tesla’s profits nosedive and protests heat up. The White House says this was always the plan. But here’s the twist as Musk is technically a “special government employee” which means if he works fewer days, he can extend his government tenure past May.