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Following the site’s takeover by Elon Musk, the fortunes of X (formerly Twitter) have dropped substantially.
The asset manager Fidelity, which helped Musk lock in the landmark deal and later made an investment of $19.66 million in the site, has significantly reduced the value of its stake in the company.
Musk initially purchased the social media giant for $44 billion. Rather than continuing to grow following its rebranding to X, the site’s value has been rated lower and lower, thanks in part to an upswing in misleading and inflammatory content and the subsequent departure of users.
From its initial $19.66 million stake, Fidelity made a 65% valuation cut over the 11 months following the 2022 takeover. This would be again reduced to 71% in January 2024, arriving at 79% as of September 2024. Fidelity now values its shares in X at approximately $4.19 million, according to the annual report that was recently made public by Fidelity’s Blue Chip Growth Fund.
Judging by the 79% markdown, Fidelity’s current valuation of X is around the $9 billion mark, less than a quarter of its purchase price and a far cry from its pre-Musk days. While the billionaire freely admits that the initial purchase of X was an overpayment, the site’s valuation may struggle to improve while it continues to implement controversial features and changes.
