Ouch.
Financial Disaster
Multi-hyphenate billionaire Elon Musk’s social media platform X-formerly-Twitter has lost a shocking amount of its value ever since he took over in late 2022.
According to recently released disclosures, the stake of investment asset manager Fidelity’s Blue Chip Growth Fund has dropped in value by a shocking 78.7 percent. Fidelity invested $19.66 million in X through the fund, as TechCrunch reports, but as of the end of August, the value of that stake has dropped to roughly $4.19 million.
That means the asset manager is now valuing the social media platform at just $9.4 billion, a far cry from the $44 billion Musk raised in debt and equity to acquire the company.
The news highlights just how disastrous Musk’s leadership has been for X. The company has been bleeding hundreds of millions of dollars worth of advertising revenue as the mercurial CEO doubles down on turning the platform into a cesspool of disinformation and hate speech.
Run for the Hills
Fidelity had already cut the value of its stake in X in March, implying at the time that Twitter had lost 73 percent of its value since Musk took over.
The social media platform looks astonishingly different than it did just two years ago. The entrepreneur has used the platform to further racist conspiracy theories, amplify dangerous disinformation campaigns, and take potshots at his critics.
Musk infamously told advertisers to “go fuck yourself” during a tantrum on stage at the New York Times DealBook Summit in November after calling an unhinged antisemitic conspiracy “the actual truth.”
Unsurprisingly, the chaos has scared away advertisers in droves. Recent research from the data firm Kantar indicated that a record 26 percent of advertisers plan to cut spending on Twitter next year, suggesting a major withdrawal.
“Marketers are brand custodians and need to trust the platforms they use,” Kantar director of global thought leadership Gonca Bubani, said in a statement last month, as quoted by The Guardian.
“X has changed so much in recent years and can be unpredictable from one day to the next,” she added. “It is difficult to feel confident about your brand safety in that environment.”
Meanwhile, users have equally abandoned the platform in droves. According to the Financial Times, X lost nearly one-fifth of its daily active users in the US, and one-third in the UK over the last twelve months.
In short, there are plenty of signs that Musk has been incredibly damaging to the company — a major blemish on his resume that should serve as a warning to his investors.
More on X: Twitter Under “Free Speech Absolutist” Elon Musk Is Actually Suspending Way More People Than Before
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