Tesla Inc. reduced the value of its bitcoin holdings by $ 23 million in the second quarter.
The company recorded $ 50 million in bitcoin-related depreciation charges this year and made a gain of $ 128 million in March by selling some of its stakes. Tesla’s bitcoin holdings were worth $ 1.47 billion at the end of June.
The depreciation was “well below what many feared,” said Dan Ives, analyst at Wedbush Securities, noting that some feared the amount could reach $ 75 million or more.
Tesla’s bitcoin holdings are not market-valued, meaning they only impact profits if they are sold. Therefore, the sharp drop in the price of bitcoin is not reflected in the company’s quarterly results.
The price of Bitcoin plunged 43% in the three months to June to $ 33,572 a coin. The cryptocurrency closed at $ 37,337 on Monday.
In the six months to June, Tesla bought $ 1.5 billion worth of bitcoin and for a short time accepted cryptocurrency as a form of payment for its vehicles. The company stopped accepting bitcoin due to concerns that mining the cryptocurrency was consuming too much energy.
Tesla CEO Elon Musk said last week that his company would resume acceptance of bitcoin if it is confirmed that the percentage of renewable energy use is “very likely at or above 50%, and that there is a tendency for this number to increase ”.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Tesla announced Monday night that its quarterly net profit nearly doubled from a year ago to $ 1.1 billion. Total revenue increased 98% to $ 6.04 billion.
Shares were down 6.8% this year through Monday, trailing the S&P 500’s 18% gain.