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Twitter is worth about one-third of what billionaire Elon Musk paid for it last year, American financial services corporation Fidelity says.
That overall valuation comes from Fidelity, which estimated that its share was worth only $6.6 million as of April 28, the companyโs monthly disclosures show โ down from $19.7 million last October. The filing did not specify why Fidelity drastically lowered its valuation of Twitter, which is now technically called X Corp.
Muskย bought the social-media companyย late last year for $44 billion (afterย failing to back out of the deal), and has claimed Twitter wasnโt making money.
The Tesla
TSLA,
and SpaceX CEO admitted that he paid too much for Twitter last October, while adding the company had โincredible potential.โ
โAlthough obviously, myself and the other investors are obviously overpaying for it with Twitter right now,โ he said.
A leaked Musk email earlier this year also stated thatย Twitter was worth under $20 billion in March, or less than half of what he paid for it five months earlier.
Per Muskโs new media-relations policy, Twitter replied with a poop emoji when emailed by MarketWatch.
Twitter has had major financial issues since Muskโs bought the company. In 2021, a year before Muskโs takeover, 90% of Twitterโs revenue came from advertising. Andย Twitterโs adjusted earnings and total revenue dropped roughly 40%ย on a year-over-year in December, according to a Wall Street Journal report.
Musk is likely hoping that newly minted CEO Linda Yaccarino, a former advertising executive for NBCUniversal, can help restore some of the companyโs advertising connections.
MarketWatch First Take:ย Elon Muskโs new Twitter CEO faces uphill battle as โa textbook case of the glass cliffโ
Twitter has also been unable to escape controversy in recent months. Musk has laid off more than 80% of the companyโs workforce, inaccurately named news outlets as โstate media,โ and removed legacy blue verification badges.
Instead of those badges, Musk moved in favor of Twitter Blue, a subscription service that less than 1% of monthly active users pay for as of April, according toย Bloomberg.
Some critics believe the lack of a thorough verification process subjects Musk-era Twitter users to increasedย misinformation and impersonation, something that happened this week with an account impersonating Rep. Alexandria Ocasio-Cortez. The account Ocasio-Cortez is referencing subscribes to Twitter Blue, and Musk replied to one of its tweets.
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