Elon Musk’s Net Worth Tops $700 Billion As Court Restores 2018 Tesla Pay Package

In a landmark decision earlier this week, the Delaware Supreme Court officially restored Elon Musk’s 2018 Tesla compensation package, overturning a previous lower-court ruling that had voided the deal. The ruling marks the end of a high-stakes, multi-year legal saga and cements Musk’s position as the world’s richest person, and the first one to command a net worth of $700 billion.

The state’s highest court rejected the January 2024 judgment by Chancellor Kathaleen McCormick of the Delaware Court of Chancery. McCormick had previously called the $56 billion package “unfathomable” and argued that the board process was “deeply flawed” due to Musk’s influence over directors.

Delaware Supreme Court Approves Musk’s 2018 Tesla Pay Package

However, the five-judge panel of the Supreme Court noted it was undisputed that Musk “fully performed” the duties required to meet the 12 ambitious milestones set in 2018. The court ruled that completely rescinding the package was “extreme” and “inequitable,” as it would have left Musk entirely uncompensated for six years of work that significantly increased shareholder value. While the court restored the package, it still upheld the finding that the original board process was technically flawed. As a result, they awarded the plaintiff just $1 in nominal damages.

While originally valued at roughly $56 billion in 2018, the massive rise in Tesla’s stock price over the last seven years means the restored stock options are now worth approximately $139 billion.

Delaware Is Seen as a “Business Friendly” State

The ruling is seen as a pivotal moment for Delaware’s reputation as a “business-friendly” haven. The court signaled that judges should be wary of interfering with the will of shareholders, who had voted twice (once in 2018 and again in 2024) to approve the pay deal. The legal battle had already prompted Musk to reincorporate Tesla in Texas, advising other founders to “never incorporate in Delaware.” With these options restored, Musk’s stake in Tesla rises to approximately 18.1%, bringing him closer to the 25% voting power he has claimed is necessary to maintain Tesla’s leadership in AI and robotics.

Elon Musk’s Net Worth Surpasses $700 Billion

Following the news, Musk’s personal net worth surged to an estimated $749 billion, widening his lead as the wealthiest person in history. Notably, his net worth had surpassed $600 billion a few days back amid reports that SpaceX is considering a listing. The company is among the several privately-held companies that Musk owns, and its listing is expected to lead to better price discovery.

Meanwhile, Musk’s net worth could surge even further as he unlocks shares under the $1 trillion compensation that shareholders approved last month.

Tesla Shareholders Approved Musk’s $1 Trillion Compensation

This historic pay award, supported by over 75% of voters, is tied to achieving extremely ambitious operational and financial milestones over the next decade. These include

• Market Capitalization: Tesla’s market value, currently around $1.5 trillion, would need to skyrocket to at least $8.5 trillion for Musk to unlock the full payout.
• Vehicle Production: The company must achieve an annual vehicle delivery rate of 20 million, a nearly tenfold increase from its current levels.
• Robotics and AI: The plan includes targets for the deployment of 1 million “robotaxis” and 1 million of the company’s humanoid “Optimus” robots.
• Profitability: Financial goals are equally aggressive, with adjusted EBITDA needing to increase from approximately $17 billion to $400 billion.

The compensation would be awarded in a series of tranches, with each payout contingent on a combination of market capitalization and operational milestones. To receive any of the shares, Musk would need to remain with the company for at least 7.5 years, with the full package requiring a 10-year commitment.

Musk Does Not Gets Any Salary or Bonus from Tesla

Meanwhile, even if Tesla meets some of the easier targets, Musk could end up earning tens of billions of dollars. Musk incidentally does not get any salary or bonus at Tesla, and all his compensation is tied to stock awards.

While previously Musk said that Tesla would be more than the combined worth of Apple and Saudi Aramco, he has since been making even bolder predictions, and last year said that the company’s Optimus humanoid would make it a $25 trillion company. However, many Wall Street analysts don’t share Musk’s optimism and see the stock as highly overvalued.

Last month’s annual shareholder meeting served as a pivot point, with Musk fundamentally repositioning Tesla as a leader in AI and Robotics, beyond its role as an electric vehicle manufacturer. The most ambitious product reveal was the Cybercab, the fully autonomous robotaxi designed without a steering wheel, pedals, or side mirrors.

Tesla to Begin Cybercab Production in 2026

Musk confirmed that mass production is scheduled to begin in April 2026 at Gigafactory Texas, with the staggering goal of achieving a 10-second cycle time per vehicle on the production line, six times faster than the Model Y. This manufacturing efficiency is intended to allow for an annual production capacity of up to 2-3 million units, which is central to Tesla’s objective of deploying 1 million robotaxis in commercial service as part of Musk’s long-term compensation milestones.

Musk also amplified the vision for the Optimus humanoid robot and stated the robot represents the future of the company, announcing the ambitious target of 1 million units. He projected that once production scales, the cost of an Optimus unit could be controlled to approximately $20,000, making it an affordable product that would dramatically expand Tesla’s economic scale. He presented the robot’s debut performance, where it danced alongside Musk as a precursor to a future where Optimus could “eliminate poverty” and perform complex tasks, potentially better than humans.

Musk Touted the Possibility of Building a Chip Factory

Musk revealed details about the next-generation AI5 chip, designed to power the advanced autonomous systems of the Cybercab and Optimus. Acknowledging that the projected needs for this chip far exceed the capacity of current suppliers like TSMC and Samsung, Musk stated Tesla would likely have to construct its own massive chip fabrication facility, which he coined a “terafab.” This facility would be necessary to produce chips at the required volume and would be optimized for power efficiency, consuming roughly a third of the power of competitors’ flagship AI chips at a fraction of the cost.