Twitter’s Value Plunges to 33% of Elon Musk’s Purchase Price, Fidelity Says

According to Fidelity, Twitter’s current value is only 33% of what Elon Musk paid for the social media platform. Musk acquired Twitter for $44 billion, including $33.5 billion in equity. He has acknowledged that he overpaid for Twitter and has stated that its value is now less than half of what he paid for it.

Fidelity, which holds an equity stake in Twitter, has marked down the value of its investment. The exact methodology used by Fidelity to arrive at this new valuation is unclear, as is its access to non-public information about the company.

Fidelity initially reduced the value of its Twitter stake to 44% of the purchase price in November, followed by further markdowns in December and February. Since Musk took over, Twitter has faced financial challenges. Musk’s decision-making and issues with content moderation led to a decline of 50% in advertising revenue, with the company accumulating $13 billion of debt.

Twitter’s attempt to generate revenue through its Twitter Blue subscription service has not been successful, with less than 1% of its monthly users signing up as of March.

Musk’s investment in Twitter is currently valued at $8.8 billion, according to the Bloomberg Billionaires Index, which utilizes Fidelity’s valuation to calculate his holding.

The recent markdown has reduced Musk’s fortune by approximately $850 million. However, despite Twitter’s struggles, Musk’s overall wealth has increased by over $48 billion this year, primarily due to a 63% surge in Tesla Inc.’s share price.

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