Twitter Now Worth Nearly A Third Of Elon Musk's Acquisition Price: Report

Despite the challenges faced by Twitter, Musk's wealth has increased by over $48 billion this year

Ever since Musk took over Twitter, the company has encountered financial challenges.

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Elon Musk has publicly acknowledged that he overpaid for his acquisition of Twitter, which he purchased for a total of $44 billion, including $33.5 billion in equity. Interestingly, Musk has recently stated that Twitter is actually worth less than half of what he initially paid for it, reported Bloomberg. The reasons behind Fidelity's decision to reevaluate the valuation of Twitter and whether they have access to non-public information from the company remain unclear.

Fidelity initially reduced the value of its stake in Twitter back in November, marking it down to 44 per cent of the purchase price. Subsequent markdowns occurred in December and February, further decreasing the value.

Ever since Musk took over Twitter, the company has encountered financial challenges. Musk's decision-making process and difficulties with content moderation have had a detrimental impact on advertising revenue, resulting in a decline of 50 per cent as of March. Despite attempting to recover the lost revenue through the sale of Twitter Blue subscriptions, this strategy has failed to gain significant traction, with less than 1 per cent of Twitter's monthly users subscribing by the end of March.

According to the Bloomberg Billionaires Index, which relies on Fidelity's valuation to assess the value of Musk's holding, his investment in Twitter is currently worth $8.8 billion. Last year, Musk spent over $25 billion to acquire an estimated 79 per cent stake in the company. As a result of the recent markdown, approximately $850 million has been deducted from Musk's overall fortune, which was valued at $187 billion by the index.

Despite the challenges faced by Twitter, Musk's wealth has increased by over $48 billion this year, primarily due to a substantial 63 per cent surge in electric vehicle (EV) major Tesla's share price.

When asked for a comment, Twitter did not provide a specific response, Bloomberg reported.