Social media company X internally valued itself at $19 billion as of Monday, multiple news organizations reported, a 55% drop from what Elon Musk paid for the company last October—following a year of sweeping change and revenue struggles at the company formerly known as Twitter.
Workers install lighting on an “X” sign atop the company headquarters, formerly known as Twitter, in San Francisco, on July 28, 2023. One year ago, Elon Musk began transforming the social media platform into what is now known as X. (AP Photo/Noah Berger, File)
Associated Press
Key Takeaways
- The company handed out stock grants to employees that showed X was worth about $19 billion, according to the New York Times, citing internal documents.
- Musk purchased the majority of Twitter in October 2022 in a deal valued at $44 billion.
- Employees were offered equity in the social media company at $45 a share in the form of restricted stock units, but they will still receive $54.20 for any outstanding shares granted to them before Musk took over the company, according to the Times.
- Musk paid $54.20 a share to take the company private in 2022.
- This latest valuation is somewhat higher than the $16.9 billion that Fidelity—which has a small stake in X—valued the company at in late August.
- Forbes has reached out to X for comment.
Key Background
Since he purchased the social media platform, Musk has repeatedly said he overpaid for it. Even before the acquisition was finalized, Musk said in an October 2022 Tesla earnings call (Musk is also CEO of the electric carmaker) he was “obviously overpaying for Twitter right now,” though he believed the company’s long term potential was “an order of magnitude greater than its current value.”
The billionaire tried to call off an agreement to buy Twitter at $54.20 a share last year, citing concerns about the number of fake accounts, but Twitter sued him and asked a judge to force him to follow through, and he eventually closed the deal in October 2022. In April, during an interview with conservative media personality Tucker Carlson, he admitted the purchase was not currently “financially smart” and said the company was worth about half of what he paid for it. In a March internal memo that was leaked to the press, Musk suggested the company was worth less than $20 billion.
Forbes Valuation
We estimate Musk’s net worth at $214.8 billion, making him the wealthiest person on earth, mostly due to his stakes in Tesla and SpaceX.
Tangent
Since acquiring and taking control of Twitter, Musk has made a series of polarizing decisions including renaming the platform to X, loosening the site’s content moderation rules, charging users to get verification check marks and temporarily limiting the amount of posts a user can view or the amount of direct messages a user can send. In September, Musk revealed that ad revenue was down 60% since his acquisition.
Additionally, nonprofits like the Anti-Defamation League have reported a rise in hate speech, racism and harassment on the platform. Musk responded by threatening to sue the organization.
The company has also been embroiled in a number of legal challenges under Musk, both as plaintiff and defendant. X has faced lawsuits over allegations it has refused to pay its employees promised severance, that it’s refused to pay its rent and office fees and that it breached a contract it made with a regional jet company. As a plaintiff, X has sued the nonprofit Center for Countering Digital Hate, claiming that the organization violated X’s terms of service by collecting data for an analysis it did into hate speech on X.
This article was first published on forbes.com and all figures are in USD.
