Less Than Half of What Elon Musk Paid for X, Now Worth $19 Billion

The value of X, the website that was formerly known as Twitter, is less than what Elon Musk spent for it a year ago.
A source with knowledge of the situation estimates that the company is worth $19 billion, or $45 per share, based on restricted stock units granted to employees. Musk paid $44 billion to acquire Twitter Inc. a year ago.

The majority of Twitter employees were let go or quit after the acquisition. Musk rebranded the business as X, altered a few of the content guidelines, and saw a decline in advertising income of more than half.

An internal document was included in a previous story on the valuation by Fortune.

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Since Musk bought the company, its finances have been difficult. Based on a combination of debt and equity, Twitter was valued at $44 billion at the time of the buyout. Since Musk’s acquisition, the company has incurred $13 billion in debt, and his unpredictable decision-making and laxer content-safety regulations have alienated advertisers, resulting in a 60% decline in revenues. According to an earlier estimate from Bloomberg, X also owes roughly $1.2 billion in interest payments annually on its debt.

Musk intends for X to transition from advertising to subscription fees. However, less than 1% of users have been convinced by the corporation to join up for its monthly premium service, which translates to less than $120 million annually, according to estimates made by Bloomberg.

Additionally, Musk has made no secret of his intention to transform X into a “everything app” with the ability to accept payments and conduct commerce. The startup revealed ambitions to develop a news wire, launched audio and video calling earlier this month, and has a test employment service. Musk informed staff members that X intends to take on PR Newswire from Cision, Microsoft Corp.’s LinkedIn, and Google’s YouTube.

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CEO Linda Yaccarino presented concepts for X’s new offerings, such as the introduction of advertising tiers, to bankers this month at a meeting to discuss the company’s financial plan. Musk has previously shown interest in taking X public, but the company’s sharp decline in valuation may make it challenging.