Twitter’s valuation crashed two-thirds from the whopping $44 billion Elon Musk paid for the social-media platform, according to Fidelity.
The leading investment firm recently marked down the value of its equity stake in the company.
Elon Musk has acknowledged in the past he overpaid for Twitter. More recently, he said Twitter is worth less than half what he paid for it.
It’s unclear how Fidelity arrived at its new, lower valuation or whether it receives any non-public information from the company, Bloomberg reported.
The $44 billion acquisition cost for Twitter included $33.5 billion in equity.
Fidelity first reduced the value of its Twitter stake in November to 44 percent of the purchase price. That was followed by further markdowns in December and February.
Twitter has struggled financially since Musk took over. After saddling the company with $13 billion of debt, Musk’s erratic decision making and challenges with content moderation led advertising revenue to decline by 50 percent, Musk said in March.
An attempt to recoup that revenue by selling Twitter Blue subscriptions has so far failed to take off. At the end of March, less than 1 percent of Twitter’s monthly users had signed up.
Bloomberg said Twitter didn’t specifically respond to a request for comment.
Musk’s investment in Twitter is now worth $8.8 billion, according to the Bloomberg Billionaires Index, which uses Fidelity’s valuation to calculate the value of his holding.
Elon Musk spent more than $25 billion to acquire an estimated 79 percent stake in the company last year.
The latest markdown erases about $850 million from Musk’s $187 billion fortune, according to the index.
Despite Twitter’s issues, Musk’s wealth is up more than $48 billion this year, largely due to a 63 percent surge in Tesla Inc.’s share price.
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