On January 30, local time, a Delaware judge ruled on Tuesday that Tesla CEO Elon Musk's $56 billion (about 402.5 billion yuan) compensation package was invalid and that the company's board of directors "failed to ensure that the compensation plan was fair."

After the ruling of the lawsuit filed by Tesla shareholder Richard Tornetta, Tesla (TSLA) shares fell more than 3% in after-hours trading on Tuesday, and as of the close of the US stock market on Tuesday, Tesla rose 0.35% to $191.59, with a total market value of $610.2 billion.

The CEO compensation package Tesla gave Musk for 2018 is unprecedented among corporate compensation plans, making the Tesla and SpaceX boss a billionaire and the richest man on Earth. In a tweet late Tuesday afternoon, Musk wrote: "Never register your company in Delaware."

On November 14, 2022 local time, Tesla shareholders had sued Musk for $56 billion in compensation in the Delaware Chancery Court in the United States, which lasted for 5 days. During the trial, Robyn Denholm, the chairman of Tesla, the electric car company, said that Tesla's agreement to pay Mr. Musk about $56 billion as CEO was worth it, even though he devoted his time to building a colony on Mars and selling perfume and flamethrowers, among other projects.

Denholm has said Musk, the world's richest man, had the "vision and perseverance" to turn Tesla from a startup into one of the world's most valuable companies. Denholm has been a director of Tesla since 2014. She said the exact number of hours Musk works is not important, but rather that the board needs his "focus and attention."

Tesla investor Richard Tornetta, a minority shareholder at the time who owned nine shares of the company, claimed that the board failed to make decisions independently of Musk when it set the CEO's compensation package in 2018. Tonetta said Tesla's board gave a part-time CEO one of the highest compensation packages in the world. In addition to Tesla, SpaceX and Twitter, Musk leads the Boring Company, digs underground tunnels, and is the founder of Neuralink, a company working to implant chips into the human brain.

The compensation package stipulates that Musk will receive billions of dollars if Tesla reaches certain market capitalization and operational "milestones." Each time a market capitalization milestone and an operating milestone are reached at the same time, Musk will receive the equivalent of 1% of shares outstanding. At the time the plan was approved, Musk owned about 22 percent of Tesla. If the company's market value increases by $600 billion, his stake in Tesla will increase to about 28 percent.

In addition, Tesla posted its first annual profit decline since 2017.

Recently, Tesla released 2023 financial results show that in 2023, Tesla's total operating income reached 96.773 billion US dollars, an increase of 18.79%; Net income attributable to common shareholders was $14.997 billion. The company's gross profit margin for the year was 18.2%, down 7.35 percentage points year-on-year; Adjusted earnings before interest and tax (EBITDA) were $16.631 billion, down 13% from a year ago. Non-GAAP net income attributable to common shareholders was $10.882 billion, down 23% from the prior year. Diluted earnings per share were $3.12, down 23% from the record $4.07 in 2022.

From the perspective of financial fundamentals, the scheduled completion of sales targets and new high revenue performance, it seems that Tesla has handed over a more objective performance report, but in fact, potential factors such as slowing revenue growth and falling gross margin are also truly reflected in its stock price. The next day, on January 25 (local time), Tesla once fell more than 12%, and its market value evaporated $80.1 billion. Overnight, Musk's net worth dropped by about $18 billion, and his throne as the world's richest man was also reclaimed by the Louis Vuitton boss and his family.

Bernard Arnault, chairman and CEO of French luxury goods giant LVMH Group, once again surpassed Tesla CEO Elon Musk to become the world's richest man, according to Forbes real-time rich list data on January 28. As of now, Arnault, with a net worth of $207.6 billion, tops Forbes' list of the world's richest people, followed by Musk with a net worth of $204.7 billion and Jeff Bezos in third place.