X is officially worth less than half of what Elon Musk paid for it

Anton Ioffe - October 30th 2023 - 6 minutes read

In a surprising turn of events, iconic social media platform Twitter, under the stewardship of entrepreneur and tech mogul Elon Musk, is reportedly valued at less than half the price it was purchased for. A move that has raised numerous questions about the sustainability of Musk's grand vision and his high-stakes acquisition. Delve into this comprehensive report as we analyze the factors that led to such a precipitous fall in valuation, scrutinize the altering company policies under Musk’s reign, the bold decision to rebrand Twitter, and even explore how Musk's personal brand may have inadvertently played a role in this decline. As we dive deep into these recesses, we also try to forecast the rocky road that lies ahead for this reimagined social media leader. Strap in for a riveting read that reveals the story behind the numbers and charts the path ahead for what's now left of the microblogging giant.

Elon Musk's Acquisition of Twitter and the Resultant Decline

Elon Musk's high-profile takeover of Twitter on October 27, 2022, occurred at an impressive valuation of $44 billion. However, the post-acquisition period heralded a stark depreciation in the company's valuation, far from the anticipated flourishing that many might have predicted. Asset manager Fidelity, with a sizable stake in Twitter, attests to this depreciation in the company's valuation. Its once estimated $20 million stake in Twitter reduced to a meager $6.6m, implying a consequential deterioration in Twitter's valuation, which is currently tagged at around $14.75bn.

Musk's tenure as the head of Twitter was characterized by landmark changes. Notably, he occupied the role of CEO before subsequently passing the reins to Linda Yaccarino, the former chair of advertising sales at NBCUniversal, in June 2023. While these structural changes promised revitalization, the financial outcome contradicted expectations. Twitter's advertising revenue – a critical lifeline for any social media platform – reported over a 50% decline following Musk's ascension as CEO.

The dramatic dip in Twitter's valuation in the wake of Musk's takeover elicits a closer scrutiny of the company's financial trajectory. While establishing the specific financial impact of these changes remains a contentious issue, the fact remains that Twitter experienced a significant setback in its monetary worth. Although qualified analyses concede a brand's perceived value can influence its fiscal standing, quantifying this fluctuation in Twitter's case presents a challenge. While this issue continues to elicit diverse views, it highlights the fluid nature of business valuations, particularly in the realm of corporate behemoths like Twitter.

The Impact of Musk's Changes to Company Policies and Structure

Musk first rolled up his sleeves in making significant changes within the company and setting off a series of reforms. He employed a radical cost-cutting approach with a large-scale layoff strategy. Nearly 80% of the workforce, amounting to over 6,000 employees, was laid off, leaving the company with a scant 1,500 employees as of 2023 compared to the 8,000 strong workforce at the time of acquisition. The skeletal force had its substantive implications, especially on the company's critical infrastructure management and user experience optimization. A majority of the team leaders were left grappling in the dark, as they found themselves unable to identify who among their members were still employed. The lack of a well-guided handover process meant that critical projects were left in limbo.

Not content with workforce downsizing alone, Musk turned the company's operational model on its head. The once public company with readily tradable stocks became an enigma, with the workforce left to speculate about their pay structure and eventually their job security. One strategic move that has caused ripples is Musk's decision to curtail telecommuting - the one perk that had kept many going during the stressful post-acquisition phase. However, the reluctance to moderate content and the seemingly draconian measures that curtailed free expression on the platform have not only compromised employee morale but also fed the fear of being caught in the crossfire of arbitrary rule enforcement.

The wave of changes instituted by Musk produced dire financial implications. Despite an aggressive cost-cutting strategy which even included defaulting on rent payments from offices globally, the company's revenues took a severe hit. One major blow was experienced when important advertisers decided to withdraw from the platform, following the severely reduced workforce in charge of content moderation and the discontinuation of the site's "verification" program. The changes brought about a massive drop in revenue, culminating in the destruction of the company’s equity, a significant portion of Musk's personal wealth, and cost-heavy strategic misfires. The ultimate impact of these transformations is yet to be fully realized.

Twitter's Rebranding to "X" and its Consequences

The astonishing transition of Twitter into "X", spearheaded by Elon Musk, encompassed far more than a shift in name. This strategic decision, coupled with the adoption of a minimalistic black and white "X" logo, had crucial implications for the company's standing. Analysts suggest that the ramifications of these radical changes propagated a significant depreciation in Twitter's assets.

Although Twitter's emblematic bird was replaced by a bold "X", the absence of the little blue insignia unleashed profound upheaval within the brand's advertising revenue. It was observed that this stream registered a decline of over 50% since October. This indicated that the fundamental shift had not sat well with the advertisers. In light of the rebranding discovery, Twitter's brand underwent a devaluation, with Brand Finance recording a 32% fall since the last year.

The transformation within Twitter extended beyond the exterior facets - swaying the company's operational path as well. Musk harbored a vision for X, projecting it as a comprehensive platform accommodating audio, video, messaging, payments and banking. Coinciding with this operational modifications, the San Francisco headquarters paraded a new logo and signage reflecting X. Just as the company embarks on this challenging journey of transformation, it stirs up a crucial question - Does the reinvention under the banner "X" lead the company to a promising future, or does it preview the onset of a consequential marketing debacle?

The Influence of Musk's Personal Brand and its Effect on Twitter's Valuation

Elon Musk’s undeniable influence not only as a business magnate, but also a veritable brand in himself, is worth dissecting when considering the declining valuation of Twitter. The personal appeal of Musk's brand –– a figurehead for audacious innovation, non-conformist thinking, and some might say, rampant controversy –– is generally regarded as a powerful force in and of itself. Although seen by many as charismatic, Musk’s brand has equally sparked a significant backlash, particularly stemming from his courting of controversy and perceived support for tweeters who defy content rules. This has had the effect of alienating many traditional advertisers, triggering a notable exodus pushing Twitter's revenues down by over 50%.

Musk’s individual clout goes further in terms of impact, infiltrating Twitter’s corporate brand and somehow usurping it. This phenomenon has seen Twitter’s established brand equity become enmeshed with Musk's personal brand, with a significant chunk of it lost among users and advertisers alike. Dipanjan Chatterjee, an analyst at Forrester Research Inc., encapsulates the notion best – the perception of Twitter’s brand has fundamentally morphed, with substantial strain since Musk's takeover. This intertwining of brands comes with its set of risks and rewards; while it may bring innovation and disruption to the platform, it has evidently depreciated Twitter’s valuation in the short term.

Against this backdrop, Musk has ambitious plans for Twitter, alongside a host of potential implications for its worth. From being a social media platform, there is chatter of Musk's intent to transform it into a combined audio, video, messaging, payment and banking app. Herein lies a future risk for Twitter. Building these additional functionalities into Twitter will require customer trust — a commodity that, as Allen Adamson, co-founder of the marketing and branding consulting group Metaforce, warns, will be challenging to secure with a fresh product name that diverges from the established Twitter brand. For many, this move appears to be more of an “ego decision” on the part of Musk than a rational business choice. Regardless, Musk’s personal brand is inextricably woven into the fate of Twitter's future valuation. In monitoring such developments, one thing is clear –– the ramifications of Musk’s personal brand on Twitter’s significance and perceived value continue to unfold.


In a surprising turn of events, Twitter, under Elon Musk's leadership, is now valued at less than half the price he initially paid for it. This article delves into the factors behind this decline, including the company's changing policies, rebranding to "X", and the influence of Musk's personal brand. The article highlights the significant impact these factors have had on Twitter's valuation and raises questions about the company's future. Key takeaways include Musk's acquisition resulting in a decline in valuation, the negative financial implications of his changes to company policies and structure, the consequences of Twitter's rebranding, and the influence of Musk's personal brand on the company's value.

Don't Get Left Behind:
The Top 5 Career-Ending Mistakes Software Developers Make
FREE Cheat Sheet for Software Developers