A little less than a year ago Elon Musk offered to buy Twitter for 44,000 million dollars. After months of bickering , the billionaire ended up taking over the social network, and since then he has made a lot of controversial decisions. The results so far are not good.
Twitter is now worth $20 billion. According to data revealed in The Information and The New York Times, Elon Musk values the company at about $20 billion. Musk emailed employees last Friday to announce a new stock-based compensation plan, and according to his offer, Twitter’s current valuation is just that: less than half what Musk paid just six months ago.
Radical change . In that message, Musk highlighted how the financial position of the platform was still precarious. “Twitter is rapidly being restructured,” he said, adding that at one point in that process the company came within four months of bankruptcy.
But it can be worth 250,000 million. Despite all this, Musk believes that Twitter can be revalued and multiply its current value by more than ten. In his message, he pointed out how he sees “a clear but difficult path” to a valuation of 250,000 million dollars. Employees will be allowed to sell shares every six months, similar to SpaceX employees.
It’s already worth little more than Snap. Twitter’s situation is worrisome and in fact that assessment made by Musk himself would leave it only slightly ahead of Snap. This company has 375 million daily active users, compared to the 237.8 million Twitter revealed it had before going private again. Snap has a market valuation of about $18 billion.
Revenues are still in trouble. The truth is that the valuation is a true reflection of a very difficult situation with a Twitter up to its neck in debt and that has lost a good part of its advertisers. The plan to make the subscription model much more important does not pan out: according to The Information, there were about 180,000 Twitter Blue subscribers in the US at the beginning of February, an alarmingly short number for Musk’s goal.
But Twitter was (probably) not worth $44 billion. When Musk made the offer to him, he did so at a price of $54.20 per share, an increase of 54% from the price they had before he announced his stake in the company as the largest shareholder. He therefore paid a significant premium, but for some analysts the valuation of Twitter before these movements began was around 20-25,000 million dollars. Musk bought expensive (knowingly), but has not yet managed to redirect the steps of the company.
