X’s value has dropped 56 percent since Musk purchased it as Twitter

Late last year, Elon Musk acquired X, then Twitter, for $44 billion USD (roughly $59 billion CAD at the time).

Five months after the acquisition, the valuation of the company had already fallen by more than 50 percent, being valued at roughly $20 billion USD (about $27.4 billion CAD) at the time.

Now, according to equity awarded to X employees found in internal documents viewed by The Verge, the company is valued at $19 billion USD (roughly $26.3 billion), or about $45 USD per share.

That is a roughly 56 percent trim from the price Musk bought Twitter for.

Musk, however, thinks that getting equity at these prices is great, and he believes that the company can one day reach a $250 billion USD (about $346.9 billion CAD) valuation. He says that reaching that valuation is a “clear but difficult path,” which would make the current employee stock grants worth more than ten times as much as they are now.

However, the platform doesn’t seem to be in a good position to increase its revenue. In the past year, Twitter has lost around half its advertising revenue, and the platform’s top five advertisers are spending 67 percent less on the platform.

you should get a consortium together who understands your vision for this website (whether it’s more of a public utility or a business meant to generate cash flow is up to you) and have them buy the debt then do a tender/exchange offer for convertible notes w more favorable terms

— sophie (@netcapgirl) July 14, 2023

Further, less than one percent of all X users are signed up for Twitter Blue, which means Musk is not getting a lot of money from that front either.

It could be that Musk is betting on the eventual rollout of banking and payment features on X to take off and generate revenue for the company. However, that is still a while away. According to him, in a recent earnings call, the feature is expected to roll out by the end of 2024. Read more about it here.

Source: The Verge