X’s value plummets further

• Fidelity’s initial investment of $19.66 million that was used to help buy Twitter is now worth 78.7 percent less.
• This is 8.2 percentage points lower than Fidelity reported in January of this year.
• Several problems have plagued Twitter, now X, since Elon Musk took ownership of the platform.

Last month a court filing revealed every investor Elon Musk tapped up to pay the ill-advised $44 billion he did to take Twitter private and turn it into X, a would-be everything app. Since Musk entered the premises of the social network it hasn’t been the same, for better and worse.

In that filing, it was revealed that one of the major investors that backed Musk’s vision was Fidelity. At the end of August, Fidelity’s Blue Chip Growth Fund released disclosures regarding the assets it holds and it’s not good news for X.

At the off, Fidelity invested $19.66 million in X through the Blue Chip Fund. As TechCrunch reports, by July the value of that investment was down to $5.5 million. This means Fidelity believes the value of their investment is down 78.7 percent. Extrapolating that loss, Fidelity reckons that X is now valued at around $9.4 billion.

This is the second decrease Fidelity has marked this year. In January the asset manager reckoned X’s value was down 71.5 percent. That means that in just seven months, X’s value fell a further 8.2 percentage points.

So what has happened at X for it’s value to plummet so severely?

For one, advertisers have migrated elsewhere. In terms of users, Twitter wasn’t competing with the likes of Meta, not by a long shot. Now, with the platform’s new freedom of speech not freedom of reach policy, advertisers don’t want to advertise on X for fear of appearing alongside hate speech, bigotry and worse.

Ad-revenue share has also turned X into an engagement bait farm. Subscribing to X Premium gives users access to revenue sharing if the meet certain criteria, the trouble here is that some game the system by posting low-effort content, sucking up what little ad-revenue X garners.

Furthermore, X faces all manner of fines and controversy around the world. Right now, X has to pay $1.9 million to get back in Brazil’s good books, over and above the $3.4 million it currently owes.

The exact reasons for Fidelity downgrading its investment value even further isn’t clear, but evidently it believes, like many others, that X simply isn’t worth the $44 billion Musk paid for it anymore.

In addition to everything else we’ve mentioned, X users are seeking out greener pastures. Sure, there are folks that continue to enjoy the platform but many can no longer stand the alt-right propaganda and hatred that floods the site on a daily basis.

How long X will remain solvent and viable remains to be seen but we suspect that Musk will continue to keep the site running for as long as he can.

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