The value of the “X” platform, formerly known as Twitter, has taken a sharp downturn, currently standing 71 percent lower than its evaluation when Elon Musk acquired it in late 2022 for a staggering $44 billion deal, according to Fidelity. This marks the second time in 2023 that Fidelity has reduced the valuation of “X,” as reported by Axios.
Elon Musk’s acquisition of the social media giant for $44 billion made headlines, with Fidelity being part of the investment group that aided Musk in securing Twitter. The deal involved $33.5 billion in stocks, with the remaining portion converted into debt to transition the platform into a private company after the deal’s completion in October 2022.
Since Musk took the reins in late October 2022, “X” has undergone significant structural changes, including layoffs and the closure of international offices. These disruptions resulted in advertisers distancing themselves from the platform.
Elon Musk had been outspokenly critical of Twitter before the acquisition, leading to the platform’s renaming. He argued that Twitter posed a threat to democracy and civilization itself, claiming it spread a “left-wing mind virus” due to the inherent bias of the company’s leadership and employees.
In the initial months of Musk’s leadership at “X,” thousands of employees were let go, and he maintained a bold stance towards advertisers, even threatening to withdraw from the platform.
Projections from Bloomberg indicate that “X” advertising revenues will reach $2.5 billion in 2023, a substantial decline from the previous quarterly average of around $1 billion.
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