Elon Musk has put the current value of Twitter at $20 billion, less than half the $44 billion he paid for the social media platform just five months ago, according to an internal email seen by American news media.
The email to employees referred to a new stock compensation program in the San Francisco-based company and the allocation of shares to employees of X Holdings, Twitter’s umbrella company since Musk purchased it in late October.
The compensation plan values the platform at $20 billion, slightly more than Snapchat’s parent company Snap ($18.2 billion) or Pinterest ($18.7 billion), both of which are publicly traded, unlike Twitter.
Musk, who is also the chief executive of Tesla Inc. and aerospace group SpaceX, said that Twitter would allow its employees to cash in shares every six months.
A query from AFP emailed to Twitter’s communications department generated an automatic response in the form of a poop emoji.
In the internal email, Musk describes the brutal contraction in Twitter’s value. He says the platform faced such grave financial difficulties that at one point it was on the verge of bankruptcy.
“Twitter was trending to lose ~$3B/year,” Musk said in a message posted Saturday on the platform.
He cited a revenue drop of $1.5 billion a year and a debt-servicing burden of the same amount -- leaving it with “only 4 months of money.” Musk, Twitter’s majority shareholder, added simply: “Extremely dire situation.”
But he then said that “It looks like we will break even” in the second quarter of the year, with advertisers -- many of whom fled the platform after the mercurial billionaire bought it -- now beginning to return.