Bitcoin rally boosts Tesla’s 2024 Q4 net income by $600 million

Tesla’s Bitcoin investment played a key role in its fourth-quarter performance, accounting for $600 million (or 26%) of its GAAP net income of $2.3 billion.

The gain came as the company adopted new accounting standards recognizing the fair market value of digital assets it holds.

Previously, Tesla had to report its Bitcoin at the lowest recorded value during its holding period, even if prices saw significant gains. However, a recent rule change by the Financial Accounting Standards Board (FASB) now requires companies to mark digital assets to market each quarter.

This change was implemented in the firm’s Jan. 29 earnings report, which showed a major increase in its Bitcoin valuation. After reporting a carrying value of $184 million for four consecutive quarters, the figure jumped to approximately $1.08 billion by December 2024.

Such a significant increase in valuation can be attributed to Bitcoin’s strong rally in late 2024, when it surpassed $100,000 for the first time and reached an ATH of $108,000. At the time, market confidence soared to a record high after Donald Trump secured reelection as US president, boosting demand for digital assets.

However, it’s important to note that Tesla did not disclose its exact Bitcoin holdings in the report, just the valuation. Data from Bitcoin Treasuries suggests that the company holds around 9,720 BTC.

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