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Fidelity: Musk Overpaid for Twitter, Now Valued at One-Third of Purchase Price

Fidelity: Musk Overpaid for Twitter, Now Valued at One-Third of Purchase Price


Fidelity Estimates Twitter’s Value to Be a Third of What Elon Musk Paid for it

Last October, Elon Musk closed on a deal to purchase Twitter for a whopping $44 billion. At the time, it was a price-tag that many estimated to be way too much money. Musk, himself, admitted that he and his co-investors may have overpaid for the social media platform. Nevertheless, he soldiered on, determined to transform his acquisition into an “everything” app that, according to his generous estimation, could eventually be worth $250 billion.

Marked Down Value

Now, a little more than half a year later, the fruits of Musk’s labor are not only not paying off but seem to be pushing Twitter’s market value in the opposite direction. This week, financial services giant Fidelity estimated in a monthly disclosure that the microblogging site is worth about 33 percent of what Musk initially paid for it—a projection that would put its value at something like $15 billion. Fidelity came up with the evaluation based on a markdown of its own stake in the company.

Unproven Valuation

Bloomberg, which originally reported Fidelity’s assessment, notes that its “unclear how Fidelity arrived at its new, lower valuation or whether it receives any non-public information from the company.”

Twitter’s Financial Situation

However the information was got, we can all agree that the resultant valuation is…uh, not great. Under Musk’s leadership, Twitter has attempted more than a few bizarre moneymaking efforts—including an ill-fated bid to make people pay for profile verification. Twitter has also tried to cut costs by firing large parts of its workforce, but the platform has suffered other financial slings and arrows—including a major dip in advertising revenue.

Musk’s Own Valuation

Musk, himself, seems to be aware that Twitter’s financial situation isn’t great. In late March, a memo leaked that showed the billionaire thought Twitter was then worth about $20 billion, or less than half of what he initially paid for it.


The future of Twitter seems uncertain as its market value continues to decline. The social media platform’s attempts to become a profitable enterprise have been largely unsuccessful under Elon Musk’s leadership, leaving investors and industry analysts wary. Only time will tell whether Twitter can turn itself around and become the everything app that Musk envisioned.


What was the original purchase price for Twitter?

Elon Musk purchased Twitter for $44 billion in October 2021.

What is Twitter’s current estimated value?

Fidelity estimated Twitter’s value to be around $15 billion in 2022, which is about a third of what Elon Musk paid for it.

Why has Twitter been struggling financially?

Twitter’s attempts to generate revenue have not been successful, including efforts to charge for profile verification. The platform has also suffered from reduced advertising revenue and has tried to cut costs by reducing its workforce.


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