Tesla shareholders approved a $1 trillion compensation package for CEO Elon Musk on November 6, 2025, structured around ambitious performance milestones over 10 years. The package could make Musk the world's first trillionaire, but it ties his payout to goals that may benefit him more than shareholders if lower targets are met. A Fortune report highlights that shareholders stand to lose the most if the toughest milestones remain unachieved.
On November 6, 2025, Tesla's board and shareholders greenlit a groundbreaking $1 trillion pay package for CEO Elon Musk, potentially positioning him as the world's first trillionaire. The compensation is designed as 12 tiers of performance milestones spanning 10 years, unlocking restricted stock options as targets are hit. Each milestone grants Musk 35.312 million shares, equivalent to about 1% of Tesla, on top of his current 16% stake, totaling 424 million shares if all are achieved.
The package blends financial and operational goals. Financially, Tesla must achieve market capitalizations starting at $2 trillion and scaling to $8.5 trillion in $500 billion increments, alongside EBITDA targets from $50 billion to $400 billion. Operationally, key metrics include cumulative vehicle deliveries of 20 million over 10 years, deployment of 1 million robotaxis, sales of 1 million humanoid robots, and widespread adoption of self-driving software. Vesting occurs in two phases: the first five years until early 2033, and the latter until late 2035.
However, the structure favors Musk even in partial success. Lower tiers are described as 'easily achievable,' ensuring a substantial payout regardless of hitting the most demanding goals. For instance, the 20 million vehicle sales target is already halfway met with 8 million sold, requiring just 12 million more at Tesla's recent pace of about 2 million annually. Reaching a $2 trillion market cap needs only an average above that level for six months and the final 30 days, which Musk has influenced before through hype around innovations like robotaxis and full self-driving.
A Fortune report emphasizes that shareholders bear the greater risk. Musk is projected to net around $900 billion overall, or $90 million annually, while shareholders might see only 5.9% yearly returns, lifting shares from $334 to $585 over a decade. In the worst case—failing the first $2 trillion milestone—Musk still secures $727 million, but investor returns would scarcely exceed inflation. For context, top CEOs like Microsoft's Satya Nadella earn $79 million yearly, far below Musk's potential windfall.
Critics argue the package dilutes shareholder value and entrenches Musk's control, but supporters see it as aligning incentives for Tesla's pivot to AI and robotics dominance.