Just five months after paying $44 billion for Twitter, Elon Musk values the platform at $20 billion.
Elon Musk is taking a huge bath on his purchase of Twitter. Musk, who paid $44 billion for the social media site in October, now values the platform at $20 billion. This new valuation is based on equity grants that Twitter made to key employees. But Elon is not looking to divest himself of Twitter and in an email sent to employees he writes,"I see a clear, but difficult, path to a >$250B valuation.
Since Musk took over Twitter, the social media site has opened its arms to those who spread misinformation, post racist tweets, and traffic in hate speech. This can't give advertisers the peace of mind they need to continue spending on Twitter. Advertising accounted for 91% of Twitter's revenue during the second quarter of 2022, the last time period that such data is available. Since Twitter is no longer a public company, Musk no longer has to publicly release financial data.
In an email to Twitter employees, Musk urged them to look at Twitter as an"inverse startup." He said that radical changes had to be made to avoid bankruptcy and says that the company could be in the black as soon as the second quarter.In a tweet he posted a couple of days ago, Musk said,"Titter was trending to lose ~$3B/year and had $1B in cash, so only 4 months of money. Extremely dire situation. Now that advertisers are returning, it looks like we will break even in Q2.
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