The decision, to be announced after the company’s annual general meeting in Austin, Texas, will boost Musk’s personal wealth to trillions of dollars and will also reveal how much trust investors have in his leadership and vision to transform Tesla from an electric vehicle maker into a company built around robotics and autonomous systems. 

A “yes” would reaffirm that faith and a “no” could unsettle markets.

The proposed package links Musk’s payout to several targets, which include Tesla delivering 20 million vehicles within a decade, putting one million robotaxis on the road, and raising its market capitalisation from around $1.5 trillion to as much as $8.5 trillion. 

Supporters call these goals huge but achievable under Musk’s leadership. On the other hand, some see them as an excessive risk that gives too much power to one man.

Among the most vocal opponents are Norway’s sovereign wealth fund and leading proxy advisory firms, who argue the package is “excessive” and “unwarranted.” Still, Elon Musk holds about 15% of Tesla’s shares and is allowed to vote them this time, making the pay package approval highly likely.

The vote also follows a case in Delaware, where Musk’s previous $50 billion package was voided earlier this year. Tesla’s relocation to Texas now allows shareholders to revisit that compensation under different corporate laws.

Tesla’s Chair, Robyn Denholm, in a letter to shareholders, urged support for the plan: “The fundamental question for shareholders at this year’s Annual Meeting is simple: Do you want to retain Elon as Tesla’s CEO and motivate him to drive Tesla to become the leading provider of autonomous solutions and the most valuable company in the world?”

Investors will also vote on whether Tesla should invest in xAI, Musk’s artificial intelligence company. He has previously said Tesla “should back the company,” but the board has not endorsed the move. Some see it as a way to speed up Tesla’s AI vision; others fear conflicts of interest, given Musk’s multiple ventures.

Another proposal seeks to abolish Tesla’s supermajority voting requirement, which currently demands a two-thirds majority to make key changes. Previous attempts to scrap it failed in 2019, 2021, and 2022. If passed, it would lower the threshold to a simple majority, and some investors believe it could consolidate Musk’s influence further.

A separate proposal calls for Tesla to adopt a political neutrality policy, prohibiting partisan activity by executives and assigning oversight to a board committee. Tesla’s board opposes the measure, saying its current governance already ensures transparency and accountability.

This measure indirectly tests investor mindset toward Musk’s outspoken political behaviour, including his public support for former U.S. President Donald Trump.

Despite the near certainty of passage, the vote has divided institutional investors. Norway’s sovereign wealth fund, several U.S. pension funds, and major proxy advisers such as ISS and Glass Lewis have all declared opposition. 

Musk’s base of retail shareholders, however, remains fiercely loyal and could provide the margin of victory, as they did in last year’s shareholder vote.

Musk’s personal ventures, public remarks, and unpredictable management style have repeatedly influenced Tesla’s stock and reputation. 

It’s been argued that Tesla’s board has become too aligned with him. Stephen Diamond, a corporate governance expert at Santa Clara University, observed: “There’s very little evidence of any dissent or daylight between the board and Musk on any issue. You just have to wonder whether that’s really a rational way to run the company.”

If the new pay package passes by a wide margin, it would strengthen Musk’s grip on Tesla and symbolically counter the Delaware court’s earlier ruling. But a narrow approval could lead to investor unease over Musk’s position and Tesla’s future governance.

Musk himself has tied his continued leadership to shareholder approval. Tesla’s board previously revealed that he might walk away if denied the package. 

The Santa Clara-based chipmaker’s stock climbed nearly 5% in premarket trading on Wednesday, briefly touching $4.94 trillion before settling around $4.89 trillion in market value.

The rally followed Chief Executive Jensen Huang’s announcement of $500 billion in AI chip bookings and plans to build seven new supercomputers for the U.S. government.

Speaking at Nvidia’s developer conference in Washington, Huang disclosed that one of the supercomputers will be developed in partnership with Oracle and powered by 100,000 of Nvidia’s advanced Blackwell chips. 

The firm also confirmed a $100 billion partnership with OpenAI to develop GPU supercomputers and a $2 billion equity investment in Elon Musk’s xAI.

Nvidia’s transformation from a niche graphics card maker into the backbone of the artificial intelligence ecosystem has been commendable. The company now sits ahead of Apple, Microsoft, and Alphabet in valuation growth.

“In many ways, everything that could have gone right for the firm, has gone right over the last sort of 24 hours,” said Michael Brown, senior research strategist at Pepperstone.

For its fiscal second quarter of 2026, Nvidia reported revenue of $46.7 billion, a 56% increase year-on-year, with data-centre GPUs accounting for 88% of sales. The company’s stock added roughly $230 billion in value within a single day, illustrating its market-moving power.

Analysts, however, warn that Nvidia’s valuation, trading at about 50 times forward earnings, leaves little room for error. Given its dominant weighting in the S&P 500 and Nasdaq 100, any major price movement could send ripples through pension funds, ETFs, and technology portfolios across global markets.

Beyond the markets, Nvidia has also become an important player in U.S.–China technology diplomacy. Its Blackwell processors are at the heart of Washington’s export restrictions, aimed at limiting China’s access to advanced AI computing systems. U.S. President Donald Trump said on Wednesday he might raise the issue of the high-end chips when he meets Chinese President Xi Jinping.

To remain compliant with these export rules, Nvidia is designing modified versions of its chips for overseas markets, a strategy to sustain demand while scaling through geopolitical pressure. This could ultimately speed up the $5 trillion valuation reach for Nvidia.

Morgan Stanley, the lead banker for xAI, is currently looking to raise $5 billion through a debt offering. In meetings held with prospective investors willing to commit a minimum of $50 million, the bank revealed selected internal figures outlining xAI’s long-term financial targets and current losses.

According to information shared with those investors, xAI generated $52 million in gross revenue during Q1 but recorded a loss of $341 million before interest, taxes, depreciation and amortisation (EBITDA). 

Cash flow from operations was negative $220 million. The company had already spent $2.6 billion on capital expenditures and has plans to spend another $18 billion on data centre investments.

Even with the deep red figures, xAI expects a sharp turnaround over the next five years. Forecasts presented show the company hitting $2.7 billion in EBITDA by 2027 and climbing to $13.1 billion by 2029. 

On the revenue side, the company aims to close 2025 with $1 billion in gross income and projects $14 billion by the end of 2029.

These figures come as xAI simultaneously seeks a $113 billion valuation through a separate $300 million equity raise. The materialisation of this may depend on Musk’s current political entanglements.

The backdrop to all this is a public clash between Musk and Donald Trump. What began as a difference of opinion over government contracts escalated into a volatile exchange. Musk ultimately declared: “Trump should be impeached.”

This fallout has introduced complications for Morgan Stanley’s fundraising efforts. Some investors are reportedly wary of potential political backlash, especially considering Trump’s history of targeting institutions and individuals who challenge him. 

At this stage, it’s undefined how much the conflict has affected xAI’s debt sale, though signs of market nervousness are evident. For instance, the price of a loan tied to X, another Musk-owned company, reportedly dropped by 1.25 points on the same day Musk’s comments were made public.

Efforts are reportedly underway to defuse the stress. According to Politico, the White House has scheduled a private call between Musk and Trump in a bid to ease hostilities.

While investor interest in generative AI remains high, the financial model for many startups is still viewed as a long-term bet. Most require massive upfront capital to build data infrastructure and hire elite AI talent. xAI is no exception. 

Neither Morgan Stanley nor xAI have issued formal comments regarding the funding round or the political situation as of the time of filing this report.