Elon Musk, the billionaire entrepreneur, recently valued Twitter at approximately $20 billion in an email that was seen by The Information and The New York Times. Musk had acquired the social media company for $44 billion last year. He shared the valuation in a memo to Twitter employees, announcing a new stock compensation program. Musk also warned the workforce that the company was still in a precarious financial position, despite the significant drop in valuation. According to Musk, Twitter was being rapidly reshaped and had been close to running out of cash at one point.
Zoë Schiffer, a writer for Platformer, reported that Musk had informed employees that he sees a “clear but difficult path” to a hypothetical $250 billion valuation for Twitter, a situation that would increase the current stock grants by tenfold in the future. Musk stated that Twitter would allow staff to sell stock every six months, a policy similar to one used at SpaceX. He believed that the program would give employees “liquid stock” while protecting them from the “price chaos” that comes with equity at a publicly traded company.
At $20 billion, Twitter would be worth more than Snapchat creator Snap, a company with nearly 140 million more daily active users. However, the estimate reflects the challenges Twitter has faced due to Musk’s decisions. Twitter’s daily revenue had reportedly dropped by 40 percent from the previous year’s start after over 500 top advertising partners had paused their spending on the platform. Many of these companies had left following the firm’s messy relaunch of Twitter Blue, where verified trolls had abused the service to impersonate brands. The Information reported that there were only approximately 180,000 Twitter Blue subscribers in the US at the start of February, indicating that the service is not even close to making up for the financial downturn Twitter has experienced since Musk’s takeover.
