The social media platform formerly known as Twitter is worth almost 80% less than two years ago when Elon Musk bought it, according to estimates from investment giant Fidelity.
X (formerly known as Twitter) no longer trades publicly after Musk shelled out $44 billion to take it private in October 2022.
However, Fidelity discloses what it believes is the value of its shares of X (formerly known as Twitter), and those estimates serve as a closely watched barometer for the overall health of the company.
As of the end of August, those shares were worth just $4.2 million, according to a Sunday filing by Fidelity’s Blue Chip Growth Fund.
That new estimate marks a 24% drop in value from what Fidelity estimated as of the end of July. And it represents a staggering decline of 79% from the $19.66 million that Fidelity estimated the shares were worth in October 2022 when Musk acquired Twitter.
The new valuation from Fidelity implies that it believes X (formerly known as Twitter) is now worth just $9.4 billion — a far cry from the $44 billion that Musk paid. Other investors could value X (formerly known as Twitter) differently.
Analysts say Fidelity’s plunging price tag for X (formerly known as Twitter) likely reflects shrinking ad revenue at the company, which no longer publicly releases quarterly financial metrics.
Fidelity declined to comment on individual companies.
X (formerly known as Twitter) did not respond to a request for comment.
Ad pressure on X (formerly known as Twitter)
“Musk clearly overpaid for this asset,” Dan Ives, managing director and senior equity analyst at Wedbush Securities, told CNN in an email.
Ives said that he believes Twitter was really worth around $30 billion when Musk bought it, and today it’s worth closer to $15 billion. He said that while engagement on X (formerly known as Twitter) is “strong,” ad pressure has persisted.
Under Musk’s ownership, some advertisers have expressed concerns about extreme content on the platform that they don’t want their brands linked to.
A recent global survey by Kantar found that a net 26% of marketers plan to decrease their spending on X (formerly known as Twitter) next year, the steepest pullback from any major global ad platform. Just 4% of advertisers said they think X (formerly known as Twitter) ads provide “brand safety” (certainty that their ads won’t appear near extreme content), compared with 39% at Google.
In November, Musk faced a backlash from brands, some of which halted spending on X (formerly known as Twitter), after the billionaire embraced an antisemitic conspiracy theory favored by White supremacists.
Musk later apologized for what he called his “dumbest” ever social media posting. However, during that apology, Musk also told fleeing advertisers: “Go f**k yourself.”
But X (formerly known as Twitter) continues to be a major player in social media under Musk’s ownership.
The company said it had 570 million monthly active users during the second quarter, up 6% from the year before.
However, research firm Similarweb has found some drops in engagement.
X (formerly known as Twitter) had 73.5 million monthly active users on iOS and Android combined in the United States in August, according to Similarweb data shared with CNN. That represents a drop of nearly 11% year over year and a 20% decline from October 2022.
Similarweb also found that US web traffic to X.com in August was lower than it was for Twitter.com before Musk bought it. However, Similarweb said X (formerly known as Twitter)’s traffic numbers have been somewhat stronger outside the United States.
Gene Munster, managing partner at Deepwater Asset Management, said he doesn’t believe the value of X (formerly known as Twitter) has dropped nearly as much as Fidelity’s estimates imply.
“Fidelity was overly aggressive. They are essentially cleaning house on the investment,” Munster told CNN.
Munster said that in the long run, he thinks X (formerly known as Twitter) and the data the company has access to will be worth more than the $44 billion that Musk paid for Twitter.
“If you want a real-time understanding of what people are thinking, Twitter is the best source of that. And that is valuable,” Munster said.
It’s especially valuable because X (formerly known as Twitter) data has helped train Grok, the artificial intelligence chatbot developed by xAI, Musk’s increasingly valuable AI startup.
X (formerly known as Twitter) has emerged as the unique angle for Grok, which Munster said has the potential to be Musk’s biggest source of wealth.
“When Musk bought Twitter, investors didn’t realize we’d be taking off on AI as fast as we are,” Munster said. “Musk buying Twitter is a case of better lucky than smart.”
Hilarious!
Posting has never been political action. Reducing politics down to consumption of entertainment products is one of the worst features of American liberalism. Voting in bourgeois elections is nearly worthless in most cases, and all the #resistance tweets in the history of time combined are still worth less than a single vote.
I’d wager that most botched corporate rebrands are a result of acquisitions by some rich dipshit who lays off staff and makes arbitrary changes driven by vanity. Elon Musk didn’t do anything different than every other oligarch in the industry, he’s just less skilled or invested in the PR flattery that most companies employ when they’re actually trying to make a return on investment. Twitter was never a user-owned global town square for democratizing communication. It was always a Skinner box designed to maximize ad revenue.
I will shed no tears for the poor consumers who are now getting their treats from the rude vampire that makes them feel embarrassed instead of the polite vampire who let them pretend that indulging their addiction to looking at ads on their phone was actually politics. I will similarly shed no tears for the writers at CNN, a company so evil that OP intentionally posted an archive link to avoid giving them ad views, or any other privately owned imperial media outlet.
Now that I’ve calmed down a bit, it’s time to address this nonsense bit by bit.
Then why are you on lemmygrad? Even pre-internet revolutionary efforts had means of spreading information, such as newsletters and the like.
That has 0 to do with what I said. Like it’s so far off, I’m not even sure what you’re talking about.
Twitter political posting is a lot more than posts about voting. You could take my word for this since I know it for a fact over years, or you could continue to wallow in ignorance and talk down about something you don’t understand.
So now you’re just wildly speculating to back up your argument?
Based on wild speculation.
And yet it managed to (hopefully still does) have political action on it that made a discernible difference in how some people think, what they are aware of, etc. Want to guess where I got a lot of primary source information when the 2020 protests were happening? Undeniable clips that made police brutality evident? There was somebody with a megathread on there, updating and adding to it for a while. I don’t think they were even a communist, just someone who wanted to draw attention to what was going on. This on top of all the dissemination of reports from brave citizen journalists on the ground. Want to guess where I got a lot of primary source info on the ongoing genocide? Like whose side are you on here?
Now you’re just making stuff up whole cloth. Embarrassment has nothing to do with it. The fact that the platform has more overt reactionary spew on there than I can ever remember being there is certainly a difference, however. And calling it treats implies you know virtually nothing about Twitter. It is common among people who do use it for political efforts to also hate dealing with it. It has long been a pain in the ass platform, but people use it anyway because it has effectiveness. Sometimes you have to use the tools that are available, even if they aren’t ideal. It isn’t a fucking game.
See everything else I’ve said. This is such a gross portrayal of the platform and its users I don’t even know where to begin. And again, why are you on lemmygrad if you are so viscerally bitter toward Twitter users? It isn’t vastly different in structure. It is also posting on the internet to other people on the internet without necessarily following it up with RL action.
No one asked you to? What a bizarre soapbox to get up on.
I’m going to stop at this part because if I go much beyond it I’m going to go off on you and I don’t want to do that. Suffice it to say, there’s a good chance I would not be anti-imperialist and communist without Twitter, there are countless bits of information I probably never would have come across, and insulting and downplaying the contribution of mass spreading of information and influence over narrative is counter-revolutionary nonsense.