X Suffers Historic Blow as Fidelity Slashes Valuation by 71.5%
Karobar
According to a recent filing, mutual fund provider Fidelity has reduced its stake in Elon Musk's X holdings, the parent company of X (previously Twitter), by 71.5% from the original share valuation.
In October 2022, Fidelity invested $19.2 million to purchase a portion in X. In October 2023, the fund management implemented a 65% reduction in valuation. And now, the company has further reduced X's valuation in the November 2023 report. Interestingly, Fidelity's disclosures are made one month after the actual date.
Over the past year, X has seen a number of changes, one of which is the appointment of Linda Yaccarino, a former executive from NBCU, as its new CEO. In September 2023, Yaccarino stated in an interview at the Code Conference that the company will start making money in 2024.
Persuading sponsors to invest in the platform is the company's largest obstacle. Following Musk's claim that an antisemitic conspiracy theory was the "actual truth," a number of well-known sponsors with a strong online presence, including Apple, Comcast/NBCUniversal, Disney, Warner Bros. Discovery, IBM, Paramount Global, Lionsgate, and the European Commission, left the site.
At the Dealbook Conference later that month, he ordered advertisers to screw themselves.
Musk went on, "This advertising boycott is going to kill the company." "And we will meticulously record everything, so everyone on the planet will know that those advertisers killed the company."
The Financial Times revealed in December that X intends to win over small and medium-sized companies so they would continue to purchase advertising on the platform. X informed FT that the expected loss will be between $10 and $12 million, refuting the New York Times' assertion that the platform will lose $75 million as a result of an advertiser boycott.
"We have definitely underplayed the importance of small and medium-sized businesses for a long time. It was always part of the plan, and now we're going to take it even further," X told the outlet.
In addition, Musk has taken the contentious decision to reinstate the accounts of users who had previously been banned, including right-wing professor Jordan Peterson, far-right influencer Andrew Tat, conspiracy theorist Alex Jones, Kanye West, and former US President Donald Trump.
