Featured Image Credit: Win McNamee/Getty Images. Matt Cardy/Getty Images
Topics: Social Media, Twitter, Elon Musk
Stewart Perrie
Topics: Social Media, Twitter, Elon Musk
Elon Musk has seemingly confirmed Twitter/X is now worth less than half what he paid for last year.
It was a huge moment when the Tesla CEO decided to dip his toe into social media and bought the bird app for a whopping $44 billion.
The tech billionaire insisted he wanted to preserve the digital town square and ensure people had a voice.
However, it's been a rough year since then.
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Musk slashed loads of jobs in an attempt to bring the company back into the black.
He also changed several aspects about the social media platform, like removing the blue checkmark for verified accounts and allowing anyone to buy the honor for $8 per month, introducing Community Notes, and changing the name from Twitter to X.
But it seems like these haven't had an overall positive effect on the company's valuation.
This week, Musk rolled out a new employee equity compensation plan, which allows staff to have shares in the company they work at.
It was during this process that he reportedly revealed X is now worth around $19 billion, according to Rolling Stone and Fortune.
That's a 55 per cent drop since his purchase date.
This is $1 billion less than the valuation that was done earlier this year.
But the number could be even smaller as Fidelity, the mutual fund giant who gave Musk $300 million to pay for Twitter, wrote down the value of their shares by 8 per cent in September.
Axios says that readjustment brings down their assessment of the value of the company to 65 per cent less than what Musk bought it for.
Earlier this year, Musk confirmed that Twitter/X was struggling to get money through the door.
He responded to a user and said: "We’re still negative cash flow, due to ~50% drop in advertising revenue plus heavy debt load.
"Need to reach positive cash flow before we have the luxury of anything else."
He has flagged an annual charge for all users of $1 to ensure bots stay at an absolute minimum, however it's unclear how long it will take for the company to be cash rich.