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Yes—but shareholders did not approve a $1 trillion cash payment. At Tesla’s annual meeting in Austin on November 6, 2025, investors approved Proposal 4, formally called the 2025 CEO Performance Award. It covers 423,743,904 Tesla restricted shares that Musk can earn only if Tesla reaches demanding market-capitalization and operating milestones while he remains in qualifying service.
The award could eventually produce close to $1 trillion in stock value under an extreme-success scenario. That is a potential future value, not a guaranteed payout or the award’s grant-date accounting value. In Tesla’s Form 10-Q for the quarter ended June 30, 2026, no tranche was reported as having become an “Earned Share.”
What Tesla shareholders actually approved
The Tesla board granted the award on September 3, 2025, subject to shareholder approval. Shareholders approved it on November 6, 2025. The company’s Form 8-K reporting the annual-meeting results identifies it as Proposal 4.
The award consists of:
- 423,743,904 restricted Tesla shares in total;
- 12 performance tranches of 35,311,992 shares each;
- approximately 12% of Tesla’s adjusted share count at the relevant reference point; and
- a performance period lasting 10 years from the September 3, 2025 grant date.
That 12% figure does not mean Musk immediately received unrestricted ownership of 12% of Tesla. The shares are subject to performance conditions, certification, continuing-service requirements, vesting rules, holding restrictions and possible forfeiture. The full 2025 CEO Performance Award agreement sets out those conditions.
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The award also specifies an offset price of $334.09 per share, unless Musk pays the applicable offset in cash. That provision affects the economic settlement of the award; it is not a $334.09 guarantee of Tesla’s future stock price.
The official shareholder vote
Proposal 4 passed with the following tally:
| Vote category | Shares |
|---|---|
| For | 1,892,235,822 |
| Against | 564,940,908 |
| Abstained | 12,227,846 |
| Broker non-votes | 302,456,274 |
The “For” votes represented approximately 76.6% of votes including abstentions, or approximately 77.0% of votes cast for or against. That is the basis for descriptions of the award receiving more than 75% support. Broker non-votes are reported separately and were not votes cast for or against the proposal.
Musk did not gain ordinary voting control over the new award shares simply because the award was approved. Before a tranche becomes earned, the award shares generally must vote proportionately with the votes of other shares present and entitled to vote. Musk can, however, vote Tesla shares he already owns and other shares for which he has voting rights. He gains the right to direct the vote of a tranche’s shares only after that tranche becomes earned.
The 12 market-capitalization hurdles
Every tranche has its own Tesla market-capitalization threshold. The targets are:
| Tranche | Market-capitalization milestone | Shares |
|---|---|---|
| 1 | $2.0 trillion | 35,311,992 |
| 2 | $2.5 trillion | 35,311,992 |
| 3 | $3.0 trillion | 35,311,992 |
| 4 | $3.5 trillion | 35,311,992 |
| 5 | $4.0 trillion | 35,311,992 |
| 6 | $4.5 trillion | 35,311,992 |
| 7 | $5.0 trillion | 35,311,992 |
| 8 | $5.5 trillion | 35,311,992 |
| 9 | $6.0 trillion | 35,311,992 |
| 10 | $6.5 trillion | 35,311,992 |
| 11 | $7.5 trillion | 35,311,992 |
| 12 | $8.5 trillion | 35,311,992 |
The first 10 hurdles rise in $500 billion increments. The final two increase by $1 trillion each. The relevant market-capitalization condition generally requires both a six-calendar-month trailing average market capitalization and a 30-calendar-day trailing average market capitalization. The award agreement also contains covered-event provisions that can allow achievement to be deemed using additional market-capitalization measurements.
The final $8.5 trillion figure is Tesla’s highest market-capitalization milestone. It is not a $1 trillion compensation target. The $1 trillion headline refers to the possible future value of Musk’s shares if Tesla becomes vastly more valuable and the other award conditions are satisfied.
The operating milestones are just as important
A market-capitalization hurdle by itself is not enough. The award also contains 12 operating milestones:
| Milestone type | Requirement |
|---|---|
| Product | Deliver 20 million Tesla vehicles |
| Product | Reach 10 million active Full Self-Driving subscriptions |
| Product | Deliver 1 million bots |
| Product | Place 1 million robotaxis into commercial operation |
| Adjusted EBITDA | $50 billion |
| Adjusted EBITDA | $80 billion |
| Adjusted EBITDA | $130 billion |
| Adjusted EBITDA | $210 billion |
| Adjusted EBITDA | $300 billion |
| Adjusted EBITDA | $400 billion |
| Adjusted EBITDA | $400 billion over a separate non-overlapping four-quarter period |
| Adjusted EBITDA | $400 billion over another separate non-overlapping four-quarter period |
The repeated $400 billion targets are not three different dollar levels. Tesla must achieve $400 billion of adjusted EBITDA over three separate, non-overlapping four-quarter periods.
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For this award, Tesla defines adjusted EBITDA as net income attributable to common shareholders before interest expense, taxes, depreciation, amortization and impairment, stock-based compensation, and gains and losses on digital assets. It is therefore an award-specific measure, not simply Tesla’s reported GAAP net income.
Each tranche requires more operating achievements
The 12 tranches become progressively harder to earn. The first requires any one of the 12 operating milestones. The second requires any two, the third requires any three, and so on. Tranche 12 requires all 12 operating milestones.
| Tranche | Distinct operating milestones required | Market-cap hurdle |
|---|---|---|
| 1 | Any 1 | $2.0 trillion |
| 2 | Any 2 | $2.5 trillion |
| 3 | Any 3 | $3.0 trillion |
| 4 | Any 4 | $3.5 trillion |
| 5 | Any 5 | $4.0 trillion |
| 6 | Any 6 | $4.5 trillion |
| 7 | Any 7 | $5.0 trillion |
| 8 | Any 8 | $5.5 trillion |
| 9 | Any 9 | $6.0 trillion |
| 10 | Any 10 | $6.5 trillion |
| 11 | Any 11 | $7.5 trillion |
| 12 | All 12 | $8.5 trillion |
A tranche becomes earned only when both its market-capitalization condition and its required operating condition are met, followed by the applicable certification. An operating milestone can generally be paired with a market-capitalization milestone, but the same operating milestone cannot be reused to satisfy multiple tranches.
When would Musk actually receive usable shares?
The award has several distinct stages. Confusing them is the main reason the $1 trillion headline can be misleading.
- Issued: Following shareholder approval and applicable regulatory conditions, the restricted-stock award was issued under the equity plan. Issuance did not make all 423.7 million shares earned or freely usable.
- Earned: A tranche becomes “Earned Shares” only after the relevant market-capitalization and operating milestones have been achieved and certified, and Musk has satisfied the applicable service requirements.
- Vested: Shares earned before the fifth anniversary generally vest on the award’s 7.5-year anniversary. Shares earned after the fifth anniversary generally vest on the 10-year anniversary.
- Held: Musk generally must hold earned shares for five years after they become earned, even if the shares have not yet vested. The holding requirement means that earning a tranche is not the same as immediately being able to sell it.
The specific terms, including the vesting and holding provisions, are in Tesla’s award agreement. Depending on the circumstances, later tax, settlement and other legal requirements can also affect what Musk can ultimately retain or sell.
If Musk leaves Tesla
Qualifying service generally means remaining Tesla’s chief executive officer, or serving as an executive officer responsible for product development or operations with approval from Tesla’s disinterested directors.
Unvested shares—including shares that have been earned but have not yet vested—are generally forfeited if Musk ceases qualifying service. The award provides specified exceptions and special treatment for events such as termination without cause, death, disability and a change in control. The exact outcome depends on the reason for departure and the agreement’s definitions.
If Tesla is sold
On a change in control, Tesla assesses achievement primarily using the relevant market-capitalization calculation. Earned shares vest upon the change in control, while unearned shares that do not qualify are forfeited. This structure is intended, according to the award terms, to evaluate Musk’s interests alongside those of Tesla’s other shareholders in a possible sale.
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If Tesla misses the targets
The award can produce no compensation if Tesla fails to reach the applicable market-capitalization threshold, does not complete the necessary operating milestones, or does not obtain the required certification. It can also fail if Musk leaves qualifying service, the 10-year performance period expires, or unvested shares are forfeited. Unearned shares are generally forfeited at the 10-year anniversary.
A financial restatement that triggers the award’s clawback provisions could also affect previously awarded compensation.
Why the package is described as worth $1 trillion
The $1 trillion description is a projection of what the shares could eventually be worth—not a formal grant-date valuation and not a guaranteed amount Musk will receive.
For the headline value to become plausible, Tesla would need to reach market capitalization as high as $8.5 trillion, meet the required operating milestones, retain Musk in qualifying service, and maintain a stock price high enough to make 423.7 million shares extraordinarily valuable. Even then, vesting, holding and offset rules would remain relevant.
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Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →| Figure | What it means |
|---|---|
| $1 trillion | A potential future value used in media and public discussion of the award under an extreme-success scenario. |
| $87.75 billion | Tesla’s preliminary aggregate fair-value estimate in its proxy using accounting valuation methods. |
| Approximately $132.3 billion | Tesla’s later 2025 maximum grant-date fair-value disclosure, assuming all performance conditions are achieved. |
The $87.75 billion and approximately $132.3 billion figures are accounting disclosures, not cash payments. They also should not be substituted for the possible future stock-market value suggested by the $1 trillion framing.
Likewise, Tesla recording compensation expense does not mean Musk received cash or unrestricted stock. Tesla recognized $527 million of stock-based compensation expense related to the 2025 award during the first six months of 2026, even though no tranche had been reported as earned. Accounting expense is recognized over expected performance and service periods; it is different from earned shares, vested shares and realized compensation.
Status as of June 30, 2026: no earned tranche reported
Tesla’s Form 10-Q for the quarter ended June 30, 2026 showed dashes in the achievement-status column for all 12 tranches. In practical terms, Tesla had not reported that any tranche had become an Earned Share by that date.
The filing did say Tesla considered the 20-million-vehicle delivery milestone probable for accounting purposes. That does not mean Tesla had achieved the milestone, and it does not mean any tranche had vested or paid out. Accounting probability assessments and formal performance certification are separate steps.
So the accurate status is: the award was approved and issued as a conditional restricted-stock award, but no tranche was reported as earned as of June 30, 2026. Musk had not received a $1 trillion payment.
Why Tesla’s board supported the award
Tesla’s board argued that the award would:
- retain Musk over the long term;
- incentivize expansion beyond electric vehicles into artificial intelligence, robotics, bots and robotaxis;
- tie compensation to Tesla’s market value and operating performance;
- give Musk additional influence over Tesla’s future while requiring continuing involvement; and
- reduce the uncertainty created by litigation over the separate 2018 compensation package.
Those are Tesla’s stated reasons, not an independent finding that the award was necessary or fairly priced. Tesla’s proxy statement presents the board’s rationale and its argument that the targets were unusually ambitious and aligned Musk with shareholders.
Why some investors opposed it
Opponents focused on the award’s scale and on the governance risks that could accompany such a large equity grant. The principal objections included:
- potential dilution for existing shareholders;
- concentration of corporate power in one individual;
- key-person risk and concerns about Musk’s time and attention;
- questions about Tesla’s board independence and the negotiating process;
- uncertainty over how objectively product milestones such as robotaxis and bots could be evaluated; and
- the scope of board discretion to adjust or interpret milestones.
Proxy advisers ISS and Glass Lewis recommended voting against Proposal 4. Tesla acknowledged those recommendations in a proxy-solicitation filing while defending the award’s performance requirements.
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Do not confuse the 2025 award with Musk’s 2018 package
The 2025 CEO Performance Award is separate from Musk’s 2018 Tesla compensation package.
During the second quarter of 2026, Musk exercised approximately 304 million options under the restored 2018 award and used approximately 17.5 million shares for net settlement of the exercise price, according to his Form 4 filing. That transaction concerns the restored 2018 award, not the 2025 CEO Performance Award.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Other important results from the November 2025 meeting
Tesla shareholders voted on 14 proposals. The meeting’s broader results help put Proposal 4 in context:
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- Proposal 2, an advisory executive-compensation vote, passed.
- Proposal 3, approval of the amended and restated 2019 Equity Incentive Plan, passed. This supplied the equity-plan framework under which the new award was administered, but it was not the same proposal as Musk’s performance award.
- Proposal 4, the 2025 CEO Performance Award, passed.
- Proposal 6, eliminating certain supermajority voting requirements, failed.
- Proposal 7, a shareholder proposal concerning Tesla investment in xAI, was not approved under Tesla’s bylaw standard because of the large number of abstentions.
- Proposal 12, the annual election of directors, passed.
- Several other governance and labor-related shareholder proposals failed.
The complete meeting results are in Tesla’s November 7, 2025 Form 8-K.
What the vote means for Tesla investors
If all 423.7 million shares eventually become earned and vested, existing shareholders face dilution. The most defensible description is Tesla’s own approximate 12% adjusted-share-count figure. It should not be treated as a fixed future dilution percentage because Tesla’s share count can change through additional issuances, repurchases, stock splits and other transactions.
The award also creates a trade-off in corporate governance. Tesla says the package aligns Musk’s incentives with long-term shareholder value because he receives more only if the company reaches extraordinary market-capitalization and operating targets. Critics argue that the size of the award itself could increase dependence on one executive and give him more power over a company whose board must independently oversee him.
For investors, the most useful question is therefore not whether Musk was “given $1 trillion.” It is whether the required combination of Tesla growth, product execution, profitability, executive retention and governance safeguards justifies the potential dilution and concentration of power.
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Repair common Windows errors and clear accumulated junk for a smoother, more stable PC - no reinstall needed.Free scan · no reinstallPrimary documents
- Tesla Form 8-K: November 6, 2025 annual-meeting vote results
- Tesla 2025 CEO Performance Award summary
- Full 2025 CEO Performance Award agreement
- Tesla Form 10-Q for the quarter ended June 30, 2026
- Tesla 2025 compensation disclosure
- Delaware Supreme Court opinion on the 2018 compensation package
Frequently Asked Questions
Did Tesla shareholders approve a $1 trillion payment to Elon Musk?
No. They approved the 2025 CEO Performance Award, a conditional grant covering 423,743,904 restricted Tesla shares. The award could eventually be worth close to $1 trillion if Tesla reaches its targets and the shares become highly valuable, but no $1 trillion cash payment was made.
Has Elon Musk received the 423.7 million Tesla shares?
The award was approved and issued as restricted stock subject to conditions, but Tesla’s Form 10-Q for the quarter ended June 30, 2026 showed no tranche as an Earned Share. The shares are also subject to vesting, holding and service requirements.
What must Tesla achieve for Musk to earn the award?
Tesla must reach escalating market-capitalization thresholds from $2 trillion to $8.5 trillion and satisfy an increasing number of product and adjusted-EBITDA milestones. Tranche 1 requires any one operating milestone; tranche 12 requires all 12.
Is the 2025 award the same as Musk’s 2018 Tesla pay package?
No. The 2018 package was separately litigated and restored by the Delaware Supreme Court in December 2025. A separate 96-million-share 2025 interim award was later forfeited. The 423.7-million-share 2025 CEO Performance Award is a different arrangement.
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1Repair Windows errors before they cause bigger problems2Scan for outdated or missing drivers - takes under a minute3Clear out junk files and repair common Windows errorsCan Musk vote the new award shares?
Generally, not at his sole discretion before they become earned. Unearned award shares must vote proportionately with the votes of other shares present and entitled to vote. Musk can still vote shares he already owns or otherwise controls.
The Bottom Line
Bottom line: Tesla shareholders approved the possibility of an extraordinarily valuable stock award—not an immediate trillion-dollar payday. Musk must remain in qualifying service, Tesla must meet escalating market-capitalization and operating targets, and the shares must pass through earning, vesting and holding restrictions. As of June 30, 2026, Tesla had not reported that any tranche had become earned.
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