Elon Musk has bought roughly $1 billion worth of Tesla shares, his first open-market purchase since 2020, in what analysts are calling a clear signal of confidence in the company’s future.

The purchase, amounting to about 2.5 million shares, was completed on Friday and disclosed in a regulatory filing on Monday. News of the buy sent Tesla stock up more than 6% in early trading, pushing the price above $400 before stabilising at $422.40 intraday.

Tesla has faced a difficult year, grappling with falling sales, tougher competition, and the loss of US tax incentives for electric vehicles. Its brand has also come under pressure as Musk has deepened his involvement in political causes. Against that backdrop, the stock buy is being seen as both a financial and symbolic move.

The timing also comes as Tesla’s board advances a new pay package for Musk worth up to $1 trillion, including a recent $29 billion “interim” award. Musk has previously demanded greater control of the company, at times threatening to step away unless his stake increased. By spending his own money to boost his holdings, he underlines both his commitment and belief that Tesla remains undervalued.

Tesla chair Robyn Denholm said last week that Musk was “back, front and centre” at the company and remained the right person to lead it through what she described as a “transformative period” focused on automation, AI, and the promise of robotaxis.