Musk: X Revalued at Less Than Half Purchase Price
In a recent discussion, Elon Musk acknowledged that X (formerly Twitter) has been revalued at less than half of his acquisition price. He framed the financial loss as secondary to his goal of protecting free speech, which he described as essential for democracy.
Elon Musk completed the acquisition of Twitter for approximately $44 billion in October 2022, paying $54.20 per share to take the company private. The deal was financed with about $13 billion in debt loaded onto the company, alongside a multi-billion dollar equity commitment from Musk and other investors. Following the takeover, the company, rebranded as X, experienced a significant drop in advertising revenue. Many advertisers paused or withdrew spending amid concerns over changes in content moderation and brand safety. This resulted in a 55% year-over-year decline in ad revenue in the months following the acquisition. To reshape the company's finances, Musk initiated aggressive cost-cutting measures, including reducing the workforce by approximately 80%. The headcount was slashed from about 7,500 employees to 1,500 within six months of the acquisition through a series of layoffs and voluntary resignations. The company's valuation has fluctuated significantly in estimates from investors. Fidelity, which has a stake in the company, at one point marked down the value of its investment by over 70%, implying a total valuation for X of around $12.5 billion. Another Fidelity estimate in September 2024 suggested a valuation as low as $9.4 billion. In response to declining ad revenue, X has shifted its business model to focus more on subscriptions and data licensing. The platform is working to grow revenue from its "X Premium" subscription tiers and by licensing its vast data trove for training artificial intelligence models. More recently, there have been signs of financial stabilization, with revenue showing year-over-year growth in the latter half of 2025. In March 2025, Musk's artificial intelligence startup, xAI, acquired X in a deal that valued the social media platform at $33 billion in equity. This move further intertwined the two companies, as xAI uses X's data for its models.
