According to an estimate by Fidelity, Twitter’s value has dropped to approximately $15 billion, which is about a third of the $44 billion Elon Musk and co-investors paid for the platform in October last year.
Fidelity was part of a group of outside investors that contributed over $316 million to the Twitter acquisition. This marks the fourth time since the acquisition that Fidelity has revised down its estimated value for Twitter.
According to Media Post, as of April 28, the Fidelity Blue Chip Growth Fund’s stake in Twitter, now under Musk X Holdings Corp., was valued at nearly $6.55 million. This is a decrease from $7.8 million as of January 31 and approximately $8.63 million at the end of November 2022.
Twitter has faced challenges in retaining major advertisers due to concerns about brand safety, as Musk has rejected most content moderation efforts. Recently, Twitter further diverged from content moderation practices by withdrawing from the European Union’s Code of Practice, which aims to combat disinformation and fake news. Twitter’s decision aligns with Musk’s inclination for reduced regulation while supporting increased transparency in political advertising for major online platforms.
To generate revenue, Twitter introduced Twitter Blue subscriptions, but as of the end of March, only 1% of monthly users had subscribed.
It’s important to note that Fidelity’s latest valuation estimate does not include the potential positive impacts of Linda Yaccarino, former NBCUniversal advertising chief, being named as Twitter’s new CEO by Musk. The May activities are not reflected in the valuation.
Twitter has not provided a comment on Fidelity’s report.
Musk’s personal investment of over $25 billion, which secured an estimated 79% ownership of Twitter, is now valued at $8.8 billion, based on Fidelity’s new estimate. This represents an $850 million decrease in Musk’s total worth, which currently stands at around $187 billion, largely driven by a 63% surge in Tesla stock this year, as reported by Bloomberg.