Benzinga - by Surbhi Jain, .
The downward spiral continues for X, formerly known as Twitter, with a new valuation from Fidelity’s Blue Chip Growth Fund estimating its shares at $5.3 million, down from $6.3 million in October.
This figure is a far cry from the $19.66 million valuation reported just before Elon Musk‘s takeover in October 2022.
Related: Elon Musk Takes Over Twitter: Who’s In Charge, Who’s Gone And What Happens To The Stock?
Fidelity’s consistent markdowns since Musk’s buyout raise questions about the platform’s resilience under its new ownership.
X’s Valuation: Potentially Down 72% Since Musk Took Over
The latest revelation comes on the heels of Fidelity’s announcement that its stake in the platform plummeted by 72% since Musk’s takeover in late 2022.
As of November, Fidelity reported its current stake in X was worth $5.6 million, marking a 72% drop from the valuation at the time of Musk’s assumption of control. This alarming depreciation raises concerns about X’s overall worth, potentially signaling a 72% decrease since Musk’s $44 billion acquisition.
If accurate, this would place X’s current valuation at approximately $12.3 billion, overshadowed by the $13 billion in debt that Musk incurred to purchase the platform.
Also Read: Before Musk’s Outburst At Twitter Advertisers, Fidelity Had Taken A Swipe At Valuation
X’s Challenges Beyond The Financials
In November, major advertisers, including Walt Disney Co (NYSE:DIS), Apple Inc (NASDAQ:AAPL), and Coca-Cola Co. (NYSE:KO), withdrew paid advertising in response to Musk’s endorsement of an antisemitic post, further denting X’s reputation and financial stability.
Adding to the complexity, Musk’s unfiltered responses have stirred the pot. In an on-stage interview with the New York Times, Musk told boycotting X advertisers to “go f**k yourself,” exacerbating the platform’s struggles to retain advertisers and rebuild trust.
Despite these setbacks, Fidelity’s periodic adjustments to the valuation provide a snapshot of the platform’s tumultuous journey. The comparison with publicly traded counterparts reveals Meta Platforms Inc‘s (NASDAQ:META) stock rose 4.9% in November, while Snap Inc‘s (NYSE:SNAP) shares surged by 38.2%, emphasizing X’s challenging position in the competitive social media landscape.
The saga of X, once a social media giant, raises broader questions about Musk’s vision for the platform and its ability to navigate a changing landscape.
As Fidelity grapples with continuous valuation adjustments, investors and industry observers alike eagerly await further developments, wondering if X can reclaim its former glory under Musk’s ownership.
Now Read: Elon Musk Says Excess Of Regulations An Obstacle For Business In The West: ‘It’d Definitely Take A War To Change Things’
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