X, aka Twitter, now worth 71 percent less than what Elon Musk paid for it

Yikes. Not a great way to start the new year.

Recent analysis from the mutual fund Fidelity pegs Elon Musk’s social media platform, X, at a valuation of approximately $12.5 billion.

Drastic Drop in X’s Value Since Musk’s Acquisition

In a notable decrease, the current value is 71.5% lower than its worth when Musk took over the company back in October 2022. Musk, along with a consortium of investors, acquired the social media platform for $44 billion, previously known as Twitter. Fidelity, holding equity in X, disclosed these figures.

According to Axios, Fidelity’s analysis runs through November 2023, encompassing the losses incurred by X following the mid-November advertiser exodus, where 10.7% of the depreciation occurred in that month alone.

The turmoil began when, on the night of Nov. 15, Musk supported an antisemitic, white supremacist conspiracy theory on X. Subsequent to this, Media Matters for America documented major brands advertising alongside pro-Nazi content on X, prompting companies like Apple and Disney to halt advertising on the platform.

A report from The New York Times late last year estimated X to incur $75 million in advertising losses over the final weeks of 2023 due to the advertiser boycott.

Musk topped off November by verbally attacking advertisers during an interview at The New York Times’ DealBook Summit, adding more uncertainty to Fidelity’s current valuation. In December, Musk further aggravated the situation by calling out Disney CEO Bob Iger on X for continuing to advertise on platforms like Instagram.

Over the past year, Fidelity has consistently reduced the value of its equity in X. In May 2023, for instance, the company valued X at roughly $15 billion. Unless Musk enacts substantial changes, it seems unlikely this decline will reverse anytime soon. The future of X in 2024 is certain to be intriguing.