Fidelity Investments said Twitter is currently only worth a third of the $44 billion that tech tycoon Elon Musk bought for the dominant social media platform about nine months ago. Fidelity invested in Twitter and supported Musk's takeover.
According to Bloomberg, Fidelity Investments said that Twitter is currently only worth a third of the $44 billion that tech mogul Elon Musk paid for the social media behemoth. “Twitter’s value has seen a significant decline since Musk’s takeover,” a Fidelity spokesperson revealed. “Our recent evaluation of our equity stake in the company reflects this downturn.”
Elon Musk has openly admitted that he overpaid for Twitter, which he acquired for $44 billion, including $33.5 billion in equity.“Twitter is worth less than half what I paid for it,” Musk confessed in a recent statement.
Fidelity decreased the value of its Twitter stake to 44% of the original acquisition price in November. Further markdowns on the platform followed, which underlined its continued financial issues in December and February.
Since Musk bought Twitter, the company has experienced financial difficulties. The business owes $13 billion in debt and is run by Musk. As Musk acknowledged in March, the revenue from advertising has decreased by 50% as a result of his unpredictable decision-making and challenges with content filtering. The attempt to replace lost revenue by selling Twitter Blue subscriptions has so far been unsuccessful. Less than one percent of Twitter’s monthly users had signed up as of the end of March.
In April, Musk came clean about the fact that his decision to buy the social networking company was motivated by legal pressure. The most recent downgrade reduces Musk's $187 billion fortune by around $850 million, according to the Bloomberg Billionaires Index. Musk’s wealth has increased by more than $48 billion this year, largely as a result of a 63 percent increase in the share price of Tesla.
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