Good morning.
Over the past few weeks, there have been quite a few CFO changes at major companies. The latest news comes from Tesla.
“This is a big surprise to the Street," Dan Ives, a tech analyst at Wedbush Securities, tells me.
Zachary Kirkhorn, CFO and “master of coin” at the electric vehicle maker led by Elon Musk, has stepped down as of Aug. 4. But unlike several major companies that haven't named a permanent successor for the CFO role, Tesla also announced in the SEC filing the appointment of Vaibhav Taneja as CFO in addition to his current role as chief accounting officer. The company said in the filing that during Kirkhorn’s tenure, “Tesla has seen tremendous expansion and growth.” He will remain at the company through the end of the year to support the transition.
However, the document didn’t discuss any reasons for Kirkhorn's departure. “Being a part of this company is a special experience and I’m extremely proud of the work we’ve done together since I joined over 13 years ago,” he said in a LinkedIn post on Monday. Kirkhorn thanked the employees at Tesla, and also thanked Musk for "his leadership and optimism, which has inspired so many people.”
But Kirkhorn was being considered by Tesla’s board as Musk’s successor for the CEO position, the Wall Street Journal recently reported. So why has he now chosen to leave? I rounded up three theories on why Kirkhorn is moving on.
One theory—the heavy lifting at Tesla has been done.
This would be the most positive spin on Kirkhorn’s move. He joined Tesla in March 2010 as a senior analyst in finance. When he took the CFO job in 2019, Tesla was valued at $50 billion, and today, it’s worth $773 billion, Fortune reported. Before he became CFO, Tesla had a long history of losses and occasionally burned more than $1 billion of cash per quarter. With Kirkhorn as finance chief, Tesla has experienced profitability and in the last three years has repaid about $10 billion of debt, helping to secure investment-grade ratings. As Ives put it, “The heavy lifting at Tesla has been done.”
"I believe he will likely be a CEO somewhere else in 2024," Ives says. However, "it’s a blow in the near term as Zach was a key part of this historic Tesla turnaround the last five years,” he adds. "That said, Tesla has a strong bench now.”
You can read the whole story here.
Sheryl Estrada
sheryl.estrada@fortune.com
