How Much Is Twitter Worth In 2023? Will It Survive?

By Spencer Hulse Spencer Hulse has been verified by Muck Rack's editorial team
Published on January 9, 2023

Even when Elon Musk first purchased Twitter, he said he was “obviously overpaying,” revealing a bit of remorse over the deal. However, he remained optimistic about the future, saying that the “long-term potential” was “an order of magnitude greater” than its value at the time of purchase. The question is, does he still believe it was worth it in the face of a 56% valuation cut by Fidelity and consistent trouble caused by his actions surrounding Twitter?

How much was Twitter worth then compared to now? When Musk acquired Twitter, he took it private, so stock prices are no longer available to make an easy judgment on the company’s worth. However, a Fidelity regulatory filing revealed information that gives some clues as to the company’s current worth.

When Musk went through with the purchase of Twitter in October 2022, spending $44 billion to acquire ownership, Fidelity valued its own Twitter shares at around $53 million. But just a month later, on November 30th, Fidelity took another look at the shares it owned and dropped the valuation to around $23 million.

  • Converted into a percentage, the total drop in valuation is over 56%.
  • Fidelity reported the change in valuation in other mutual fund disclosures.
  • While a shareholder, Fidelity does not have in-depth knowledge of the inner workings of Twitter.

What has caused the valuation to drop? There are a lot of reasons for the decline, including the tech landscape as a whole. However, Musk’s actions since the takeover have been polarizing. He cut a tremendous amount of staff, only to be met with a Chinese spam campaign and other problems, and he took several actions that incurred backlash, including the ban of journalists from the platform.

“I’m optimistic about Twitter’s future. There has been a cultural shift in the company, initiated by Elon Musk, that is garnering mixed reactions from the media and staff- which is understandable. The bottom line is that Elon is a visionary, he knows how to run companies, he has a solid reputation, and he innovates, which is exactly what Twitter needs.

Twitter reached its pinnacle yet failed to keep up with the ever-evolving sphere of media consumption, leaving it vulnerable to being overtaken by newcomers like TikTok. Elon Musk’s commitment to innovation is unmistakable – from Tesla, to SpaceX, and all of his other ventures. He recognizes the importance of pushing boundaries for progress. Combining his innovative vision and creative ideas with stronger financial management, Elon Musk is the perfect person to take Twitter into a new era. This is especially important now that our economy has changed so drastically,” says Mawer Capital’s Rudy Mawer. 

“Over the last 8 years, Silicon Valley tech companies have been riding a volatile rollercoaster which has now finally come to an end. As a result of this, many firms in the Valley are currently facing difficult times and challenges. He understands that to make necessary cuts and improvements, it is often better to take quick action by “ripping off the bandaid” quickly rather than gradually stretching out a long process of minor adjustments over time. Though this might appear frightening in the beginning, those who lack experience with business operations fail to realize that it is actually an expedient way of avoiding prolonged stress.

His strategy is to dive right in, act decisively, address the urgent issues and then start afresh. Twitter has definitely seen a drop in its user base due to their approach; however they have also experienced an influx of people who are devoted followers of Elon and trust his vision. Only time will tell how Twitter fares financially and in terms of growth; yet I strongly believe that he is the right individual to guide this social media platform forward” he added.

Musk has been vocal about the problems. He previously warned people that Twitter could go bankrupt, telling employees to brace for difficult times. He even compared it to an airplane “headed toward the ground at high speed with the engines on fire and the controls don’t work.”

Musk has taken significant steps to cut costs. The steps include further downsizing, as well as the shutdown of one of Twitter’s primary data centers. Moreover, the company stopped paying millions in rent and services, which were to be renegotiated or dropped entirely.

  • Twitter was sued by its landlord, Columbia Property Trust, for not paying rent for a floor leased to the company.
  • Musk has cut janitorial and security services, and there have been reports of some employees having to bring their own toilet paper.

Cutting costs might help, but there are consequences. Quality of life for employees has dropped, and with more being cut, the pressure is heightened for those sticking around. That pressure could see more people leave the company if things continue going the same way.

Additionally, Twitter has faced problems with its services, experiencing a temporary outage that might have been avoided if the data center it shut down was still operational. Combined with Musk’s polarizing actions, the decline in the quality of service has the potential to send even more people to other platforms.

Musk will likely not be CEO for long. The decision started with one of his polls, where he asked if he should step down as the CEO of Twitter, to which a majority of the voters responded yes. Musk said that he will stand by the result and is supposedly in the process of looking for a new CEO. Whether a CEO change will affect the direction of the company is unknown.

By Spencer Hulse Spencer Hulse has been verified by Muck Rack's editorial team

Spencer Hulse is the Editorial Director at Grit Daily. He is responsible for overseeing other editors and writers, day-to-day operations, and covering breaking news.

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