Twitter faces financial crisis under Musk’s control as stocks plummets

Ömer

May 30, 2023

One of this year’s biggest acquisitions, Twitter, is experiencing a financial crisis under the control of Elon Musk. The social media platform, which was sold for $44 billion in April, has seen a decline in its shares. Consequently, the price Elon Musk paid has decreased by approximately two-thirds.

Fidelity: Twitter’s stock value has decreased by two-thirds

According to investment firm Fidelity, Twitter has suffered a significant loss in value since Elon Musk’s acquisition. The company stated that Twitter’s value has dropped to only one-third of the amount Musk paid.

It remains unclear how Fidelity arrived at this analysis and what sources were used. Elon Musk, who previously admitted to overpaying for Twitter, offered $20 billion worth of stock grants to employees earlier this year.

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It is known that Twitter has been going through a financial crisis since its acquisition by Musk. The $13 billion debt, along with Musk’s controversial decisions, has led to a 50% decrease in advertising revenue. This lost revenue is intended to be recovered through Blue subscriptions.

However, research shows that at the end of March, only 1% of Twitter users subscribed to Blue. Despite promising features such as the blue tick, longer videos, and fewer ads, Blue failed to attract the expected interest from users.

Meanwhile, Elon Musk spent over $25 billion to acquire a 79% stake in the company. However, according to Bloomberg Billionaires Index, the current value of Musk’s Twitter investment is around $8.8 billion.